BP PLC has pledged to "do better" for its shareholders after canceling a $750 million (£549 million) shareholder return plan to focus on aggressively reducing its debt. The FTSE 100 constituent, which has long funded the pensions of millions of Britons through dividends, has tightened its financial defenses following a period of turbulence and terminated its share buyback program on Tuesday.
To lower its debt burden, BP will halt the buyback and implement further cost reductions amounting to billions of dollars by 2026. The oil major is currently weighed down by a substantial debt load of $22 billion and has recently faced renewed instability—its CEO, Murray Auchincloss, departed abruptly after less than two years in the role.
BP Chairman Albert Manifold, who played a key role in Auchincloss's exit, has appointed Meg O'Neill, CEO of Woodside Energy, to succeed him. On Tuesday, interim CEO Carol Howle sought to reassure investors, stating that the company would strive to improve its performance. "We have taken action, and we have the capability and the commitment to do better for our shareholders," she said.
The latest $750 million share repurchase program, announced in November 2025, was suspended on Tuesday. BP reported a $3.4 billion loss for the three months ending last December, impacted by weaker crude prices, compared with a $1.2 billion profit in the third quarter of 2025. Its full-year underlying replacement cost profit, the company's preferred earnings measure, fell from $8.9 billion to $7.5 billion. Quarterly replacement cost profit declined 16% from the previous quarter, in line with analyst expectations.
The latest earnings decline included a $4 billion impairment charge related to its "low-carbon energy" unit, part of a large write-down disclosed in January against its net-zero aligned businesses. BP had previously forecast an oil price of around $76 per barrel for this year, but current trading levels near $69 have added further pressure on its finances.
Ms. Howle stated, "With continued emphasis on capital discipline and returns, we have lowered our 2026 capital expenditure to the bottom end of the guidance range while continuing to drive down costs." Last year, BP reversed a strategy introduced in 2020 by former boss Bernard Looney that focused on renewable and green energy transition. The strategy had faced shareholder opposition, including the cancellation of a multi-billion-pound hydrogen plant in Teesside.
The oil major had previously planned to cut oil and gas production by 40% and achieve net-zero emissions by 2050. Ms. O'Neill, a former executive at US oil giant ExxonMobil, is set to take up her role in April and is expected to refocus BP on its fossil fuel business. BP has already been increasing investment and exploration in oil and gas and is in the process of selling $20 billion in assets.
Derren Nathan, an analyst at investment firm Hargreaves Lansdown, suggested that BP's decision to cancel the buyback was aimed at "clearing the decks" ahead of O'Neill's arrival to pursue a leaner, more returns-focused strategy. Shares in BP fell 3.5% in early trading.