BP’s Renewable Strategy Under Fire: Elliott Management Calls for Change – PUNE.NEWS

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Elliott Urges BP to Shift Focus from Green Investments After Building 5% Stake
Reports reveal that activist investor Elliott Management has accumulated a significant stake in British oil giant BP, estimated at around $5 billion. Elliott, known for its assertive strategies, has built a near 5% stake in BP and is pushing the company to abandon its green energy initiatives in favor of focusing on fossil fuels to enhance shareholder returns.
The U.S.-based hedge fund has acquired a position worth nearly £4 billion, approximately $5 billion, and is urging BP to cut back on its renewable energy projects. According to sources, Elliott is advocating for substantial divestments and a reduction in spending on green energy, encouraging BP to focus more on fossil fuels to improve profitability and better align with investor expectations.
BP had invested heavily in various green energy projects, including wind, solar, hydrogen, and biofuel initiatives, with renewables spending peaking at $4.9 billion in 2022. However, BP’s share performance has lagged behind its competitors. Investors have raised concerns about the company’s strategy, especially since the new CEO, Murray Auchincloss, took over. Compared to a 30% gain for Shell during the same period, BP’s stock fell about 8% after Looney’s strategy was launched.
BP has responded to Elliott’s demands by pledging to “fundamentally reset” its strategy during its full-year results presentation. The company is expected to outline these changes at an upcoming investor day scheduled for February 26th. Under Auchincloss, BP has already begun to scale back on renewables, including spinning off its offshore wind business, and last month, the company announced a 5% reduction in its global workforce, aiming for $2 billion in cost savings by the end of 2026.
Despite the ongoing challenges, Wall Street holds a Moderate Buy consensus rating on BP’s stock. This is based on five Buy ratings, six Hold ratings, and one Sell rating. BP’s stock has dropped by almost 5% in the past 12 months, and analysts set an average price target of $37.58, suggesting a potential upside of nearly 9% from current levels.
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