BP's recent trading update indicated lower oil production and weaker profit margins, raising concerns about its financial health.

The company's performance has lagged behind its European competitors, leading to scrutiny over its investment strategy in the energy market.

In 2023, BP faced criticism for scaling back its commitments to reduce oil and gas production, adjusting its emissions reduction targets significantly.

Auchincloss emphasized the need for BP to improve its competitiveness to succeed in the energy transition while continuing to invest in fossil fuels.

As part of its strategy, BP is integrating more digital capabilities into its operations, including the use of artificial intelligence.

Despite the focus on cost-cutting, BP plans to continue investing in fossil fuels, countering earlier commitments to reduce oil and gas production.

BP is set to cut approximately 4,700 jobs, representing over 5% of its total workforce of around 90,000, as part of its cost-cutting measures.

This decision follows a significant decline in BP's share price, which has dropped about 20% since spring 2024, prompting the need for these cost-saving initiatives.

CEO Murray Auchincloss aims to achieve at least $2 billion in cash savings by the end of 2026 to enhance returns and address investor concerns.

Following the announcement of job cuts, BP shares rose by 1.4% in morning trading, reflecting a positive market reaction.

The job cuts are part of a comprehensive review of BP's divisions initiated by Auchincloss, who took over as CEO in 2024 after the departure of Bernard Looney.

Additionally, BP has postponed an investor event originally scheduled for February 11 to accommodate Auchincloss's recovery from a medical procedure, rescheduling it for February 26.