BP's turbulent times may be coming to an end, but the pressure is on to prove it. With full-year results due this week, the company faces a challenging task: convincing shareholders that it can leave its turbulent past behind. The question on everyone's mind is whether BP can turn the tide and set sail towards a more sustainable future.
The oil giant is expected to report weaker annual profits, a steep decline since the Covid pandemic, as global oil prices fell for a third consecutive year in 2025. This trend is expected to continue, with City analysts forecasting a profit drop to around $7.5 billion, a significant fall from the $9 billion mark in 2024. The fourth quarter, in particular, is predicted to be a slump, with crude prices falling below $60 a barrel for the first time in nearly five years.
The upcoming CEO, Meg O'Neill, is under the microscope. She must present a compelling new strategic vision to investors, addressing the long-term decline in fossil fuel demand. This is a critical moment for BP, as activist shareholders push for a clear plan to control spending on oil and gas projects. The Australasian Centre for Corporate Responsibility, along with the Nest workplace pension scheme, has filed a resolution demanding transparency on BP's spending strategy.
Adding to the pressure, Dutch shareholder activists at Follow This are calling for BP to disclose its strategy for creating shareholder value in a world where fossil fuel demand is on the decline. This comes as BP redirects its focus back to fossil fuels, starting up seven new oil and gas projects last year, despite previous attempts to diversify into renewable energy. Five of these projects were delivered ahead of schedule, but the company's share price has still outperformed its European rivals by 4.4% over the last six months, equivalent to an additional $4 billion in equity value.
However, this success may be short-lived. Shareholder activists and green groups are gearing up to oppose BP's new fossil fuel investments, arguing that they are not financially sustainable in the face of the electric vehicle revolution and the shift to clean energy. Mark van Baal, the founder of Follow This, emphasizes the need for a new strategy to address the declining oil and gas markets. The International Energy Agency predicts that oil demand will start falling from around 2030, and Follow This believes that this new resolution will increase shareholder pressure and highlight the financial unsustainability of fossil fuel business models.
The challenge for BP is clear: to navigate the turbulent waters of a changing energy landscape and prove that it can steer the company towards a more sustainable future.
