BP retreats on buyback after tariffs weaken oil market

Tuesday 29 April 2025 8:17 am

British power big BP chopped its quarterly share buyback after President Donald Trump’s erratic tariff agenda despatched the worth of oil tumbling.

BP cuts its buyback to $750m (£559m), in comparison with $1.75bn the earlier quarter.

This comes after the price of a barrel of Brent crude sank under $70 within the fallout of Trump’s levies – the determine BP makes use of to create its monetary targets.

The reporting interval got here forward of Trump’s ‘Liberation Day’ on April 2, which slapped sweeping tariffs on all buying and selling companions.

However, London-based agency nonetheless confronted difficulties as money stream from operations slumped to the bottom degree because the fourth quarter of 2020, when the typical worth of oil was beneath $40.

The FTSE 100 conglomerate mentioned its underlying replacement-cost revenue – which gives an correct view of a enterprise’ profitability by excluding non-recurring gadgets – hit $1.38bn. This was under the $1.53bn pencilled in by analysts.

Internet debt additionally surged $4bn from the earlier quarter.

Internet earnings almost halved from the earlier yr, falling to $1.38bn within the first three months of the yr. This missed a median analyst estimate of $1.64bn.

BP going through scrutiny from activist investor Elliott

The oil firm has confronted strain from activist investor Elliott which has known as on BP to deepen spending cuts and make additional divestments.

Elliott is eyeing free money stream of $20bn by 2027, which is round 40 per cent larger than the corporate’s present aim.

The corporate’s chair Hedge Lunch mentioned firstly of this month that it was “inevitable” he would step down after the spat with Elliott.

BP introduced on 4 April that Lund had notified the board of his plan to withdraw “most definitely throughout 2026”.

This got here after BP ditched a radical plan launched in 2020 that may see the oil big reinvent itself as a inexperienced power firm.

Practically 1 / 4 of shareholders voted towards the re-election of Lunch on the agency’s annual basic assembly, as battle over the choice to axe local weather objectives continued.

The shift adopted information that Elliott had acquired a close to 5 per cent stake within the firm and was calling for widespread modifications.

Commenting on the first-quarter outcomes, chief monetary officer Kate Thomson mentioned: “Within the first quarter, we delivered resilient monetary outcomes and are in motion to enhance the efficiency of BP.

“Underlying RC revenue grew quarter-on-quarter to $1.4bn and we’ve got made good progress on our plans to ship on our structural price discount goal.

“Our monetary body gives us with flexibility via cycle. We proceed to optimize funding plans and now count on 2025 capital expenditure of round $14.5 billion.”