BP results: Anger at 'reckless shareholder payouts' as annual profits halve

This is down 50 per cent from the record $27.7 billion (£22.1 billion) notched up in 2022 when oil prices surged following Russia’s invasion of Ukraine.

The cost of crude has since eased back, with oil trading at about $82 a barrel on average through last year, against $100 in 2022.

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Shares in the FTSE 100 group surged around 6 per cent on Tuesday morning as it reported a better-than-feared drop in profits in the final three months of the year, with underlying profits of $3 billion (£2.4 billion) against $4.8 billion (£3.8 billion) a year ago.

Most analysts had expected profits of $2.77 billion (£2.19 billion) for the fourth quarter.

BP joined rival Shell in announcing further cheer for shareholders after two years of bumper profits, with another $3.5 billion (£2.8 billion) of share buybacks for the first half of the year under plans to buy back at least $14 billion (£11.1 billion) over 2024-25.

It also increased its dividend by year on year 10 per cent to 7.27 cents a share in the fourth quarter.

BP’s new chief executive, Murray Auchincloss, said: “Looking back, 2023 was a year of strong operational performance with real momentum in delivery right across the business.

“And as we look ahead, our destination remains unchanged… focused on growing the value of BP.”

But campaign group Global Witness hit out at what it said were “reckless shareholder payouts” at BP.

It claimed BP’s shareholders’ returns in 2023 – $12.7 billion (£10.2 billion) – could “cover the projected cost of natural disasters for the next seven years in the UK”.

Jonathan Noronha-Gant, Global Witness senior campaigner, said: “Shareholders should want to protect their long-term positions.

“That means demanding a rapid clean energy transition for companies like BP. These reckless shareholder payouts do the opposite.”

Thinktank the Institute for Public Policy Research (IPPR) also criticised BP’s “excessive payouts”.

Joseph Evans, researcher at the IPPR, said: “BP has decided to prioritise its shareholders over investing in the green transition.

“It’s clear that BP and other fossil-fuel giants can’t be trusted to drive the green transition: they will always prioritise their shareholders over the needs of the economy and the planet.”

BP said its fourth-quarter results partly reflected strong gas trading, offset by lower refining margins and weak oil trading.