World’s 8th Largest Oil Company Rejects Renewables
BP, the world’s 8th largest oil company, has killed almost all of its renewable energy projects by investing the money into fossil fuels. BP was known as the greenest large oil company in the world.
*Oil Is Still King
* World’s Largest Oil Company Aggressive
*Worry About The Climate Crisis
However, its renewables bets lost money, and investors forced management’s hand.
According to CNBC, “BP on Wednesday announced plans to increase annual oil and gas investment to $10 billion through 2027 as part of a fundamental strategic reset.”
BP CEO Murray Auchincloss commented, “We are reducing and reallocating capital expenditure to our highest-returning businesses to drive growth, and relentlessly pursuing performance improvements and cost efficiency. This is all in service of sustainably growing cash flow and returns.”
Oil Industry Profits
The oil industry has begun to flourish again as it has become clear that drilling will be profitable for decades. The rotation to wind, solar, and nuclear has been slow. Even if the progress of those sectors accelerates, the need for energy worldwide is rising quickly.
Oil has traded between $82 and $70 a barrel this year. To be profitable, oil companies need to make $62 a barrel on new wells. For nations like Saudi Arabia, the figure is a fraction of that.
BP Walks Away
BP is caught in a vice. A year ago, it wanted to be a green oil company, but investors have turned their backs on that.
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