BP reveals plans to deliver £1.6 billion in cost cutting

The energy giant BP has announced their underlying replacement cost profit was £2.2 billion for the first quarter compared to £3.9 billion the year before.

BP are planning a £1.6 billion in extra cost savings in the next two years after missing their forecasts and the energy giant blamed lower oil and gas prices.

Murray Auchincloss, BP’s chief executive, said, “We’ve delivered another resilient quarter financially and continued to make progress on our strategy.

“Oil production was up and our Ace (Azeri Central East) platform in the Caspian is now producing.

“We are simplifying and reducing complexity across BP and plan to deliver at least two billion dollars of cash cost savings by the end of 2026 through high grading our portfolio, digital transformation, supply chain efficiencies and global capability hubs.”

Stuart Lamont, investment manager at RBC Brewin Dolphin, said, “As with Shell last week, investors were looking for reassurance from BP on production volumes and capital discipline.

“However, BP has missed profit expectations on the back of lower gas prices, weaker margins, and operational outages.

“The extension to the share buyback programme and maintained dividend will, nevertheless, provide shareholders with some solace.”