BP has warned it will write down up to $5bn (£3.7bn) from its green and low-carbon energy businesses as it pivots back towards fossil fuels under new chair Albert Manifold. The writedown will mainly affect BP’s gas and low-carbon transition units but is not expected to impact underlying profits when full-year results are published in February. BP has already cancelled hydrogen projects in the UK, Oman and Australia and is seeking to sell a stake in its solar arm, Lightsource.
The announcement comes amid weaker oil trading and falling crude prices, with Brent crude averaging $63.73 a barrel in the final quarter of last year. BP shares dipped following the update, which followed a similar warning from rival Shell. Despite the challenges, BP said it reduced net debt to between $22bn and $23bn.
The writedown precedes the arrival of incoming chief executive Meg O’Neill, who joins in April from Woodside, replacing Murray Auchincloss. Analysts say the weaker results underline the scale of the challenge facing BP as it retreats further from the green strategy championed by former CEO Bernard Looney.
