- Bernard Looney’s ambitious tenure.
- BP’s environmental initiatives uncertain.
- Controversy marks BP’s history.
On February 12, 2020, Bernard Looney arrived at the Royal Lancaster Hotel in Central London, creating an air of anticipation.
Looney, the newly appointed CEO of BP, was set to unveil the company’s groundbreaking strategy. Such presentations usually targeted City analysts, filled with slide decks, complex queries, and perhaps a glass of wine.
However, Looney was different. He had created his Instagram account to promote trans and gay rights.
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As he took the stage, Looney made a bold declaration: BP would achieve ‘net zero’ by 2050, becoming the first major oil company to do so. The company would reduce oil and gas production by 40% by 2030 to reach this goal.
The room was captivated by Looney’s ambitious goals. His transatlantic background, from working on a family farm to leading BP, showcased his journey.
Looney was determined to champion the green agenda, pushing boundaries beyond his competitors.
Lord (John) Browne, Looney’s mentor and former BP executive, shocked the energy industry in 1997 by acknowledging global warming’s effects during a speech in California. He was also grilled in an on-stage interview by Alix Steel, a Bloomberg news correspondent.
Fast forward three and a half years, and Looney faced disgrace after admitting he hadn’t adequately disclosed relationships with colleagues.
Allegations emerged that he had promoted women with undisclosed past relationships, leading to controversy.
Clint Oswald, a Bernstein analyst, commented, ‘Looney was a charismatic company leader with a dedicated following, a typical BP and Looney event.’
While BP often took a different approach to the media, more American than British, Looney’s tenure was marked by selling hydrocarbon assets in Oman, Alaska, and the North Sea. He reshaped the company’s mentorship program, emphasizing subordinates mentoring senior executives on issues like trans rights.
An anonymous BP employee noted, “It was classic Looney behavior, his focus on these issues was genuine, though some old-timers found it overly evangelical.”
However, as the Ukraine conflict erupted, the world and the industry were in a different place. In March 2022, Brent Crude prices hit a 13-year high at $123 per barrel. Looney’s statement that BP was a “cash machine” drew backlash, and oil executives were summoned to Downing Street. By May 2022, Chancellor Rishi Sunak introduced a windfall tax on the industry.
Looney managed to satisfy investors with share buybacks and increased dividends, keeping the share price up.
Environmentalists fear BP may abandon its environmental initiatives and focus on oil production without Looney’s leadership.
Prime Minister Sunak recently postponed the country’s net-zero targets, and approval was granted to develop the Rosebank field in the North Sea.
Murray Auchincloss serves as BP’s interim CEO, but the long-term successor remains undecided. The company’s upcoming City presentation may offer insights into its future direction.
Oswald added, “The Conservatives have shifted their stance, and the country now demands more oil than before.” BP had committed billions to UK renewable energy projects under Looney, including two hydrogen facilities in Teesside.
While BP maintains its commitment to these initiatives, some City analysts remain skeptical.
David Hewitt, an oil analyst at the investment bank Liberum, commented, “The BP CEO position is up for grabs.” This presents an opportunity for the supermajor to refocus on its core business—exploration and extraction of oil and gas.
Looney’s downfall adds to BP’s history of scandals, including Lord Browne’s resignation in 2007 due to personal revelations and Tony Hayward’s resignation over his handling of the Deepwater Horizon oil rig explosion.
Neil Wilson, an analyst at Markets, stated, “This is a company often embroiled in controversy,” leaving BP’s future uncertain.
