BP has suspended its share buy-back programme after reporting weaker annual profits, becoming the first major oil company to do so. Underlying earnings fell to just below $7.5bn (£5.5bn) for 2025, down from almost $9bn in 2024, as global oil prices declined for a third consecutive year.
The decision to halt buy-backs for the rest of the year contributed to a 6% drop in BP’s share price on Tuesday. The company said it would suspend quarterly share repurchases for the first time since the early stages of the pandemic, when a collapse in oil prices forced it to a record loss.
BP’s largest rivals, including ExxonMobil, Chevron and Shell, have maintained their buy-back programmes despite falling prices. However, the market downturn has hit BP particularly hard after it reversed its green investments and wrote down the value of its renewables business by $3.1bn.
Interim chief executive Carol Howle said the company had made progress on its four primary targets: growing cashflows, increasing shareholder returns, reducing costs, and strengthening the balance sheet through asset sales. “There is more work to be done, and we are clear on the urgency to deliver,” she said.
BP is expected to use the cash saved from halting buy-backs to invest in fossil fuel production. The company commissioned seven new oil and gas projects last year, five of which were delivered ahead of schedule, as part of its plan to refocus on fossil fuels after a failed green agenda.
Incoming chief executive Meg O’Neill, former head of Woodside Energy, will take up her role in April. She will work with new chair Albert Manifold to bring “rigour” to BP’s turnaround plan, while facing pressure from activist shareholders pushing for a strategy to address declining fossil fuel demand.
