British energy giant BP said it will cut more than 5% of its global workforce as it continues its cost-cutting plan and pivots to more businesses beyond its oil and gas business. The London-based multinational group said on January 16 that it would lay off about 4,700 employees and cut about 3,000 contractor positions this year. It did not detail how many jobs would be lost in specific countries across its operations. About 2,600 of those contractor positions have been eliminated, the company said Thursday. The company has approximately 90,000 employees worldwide. BP employees were notified of the layoffs in an email. BP Chief Executive Murray Auchincloss said last year he wanted to simplify the business. Auchincloss is expected to discuss his strategy at the company's investor day on February 26. Investors have been concerned about the company's plans to reduce oil and gas production and its efforts to increase investment in renewable energy. The company said it wants to support more digitization of its operations and use more artificial intelligence in marketing and engineering. BP said in a statement on Thursday: "Last year (2024) we embarked on a multi-year plan to simplify and centralize BP. We are strengthening our competitiveness and building resilience while reducing costs, driving performance improvements and leveraging our ’s unique capabilities “To achieve this, BP’s businesses have implemented a range of initiatives. Today, we have told BP employees that the proposed changes announced to date are expected to affect approximately 4,700 BP jobs - which account for the majority of expected job losses this year. We will also reduce the number of contractors by 3,000. As our transformation continues, our top priority is of course safe and secure operations and continuing to support our team. "

"We have more work to do this year, next year and beyond, but as we position BP as a simpler, more focused and higher-value company, we will We are making great progress." It is understood that the company has set a goal of cutting approximately $2 billion in costs by the end of next year and hopes to save at least $500 million this year. Auchincloss wrote that he recognized "the uncertainty this creates for everyone whose work may be at risk and the impact it has on colleagues and teams." Company officials conducting a review of all BP divisions have said a multi-year plan to reduce operating costs could lead to more layoffs. Auchincloss said the company's focus on "our highest value opportunities" resulted in the suspension or discontinuation of at least 30 projects since June last year. Investors are wary of the company's plans announced in 2023 to reduce oil and gas production by 2030. BP's previously announced goal of reducing emissions from its operations by as much as 40% by 2030 has been revised downwards, with officials now considering reductions of 20% to 30% while maintaining investments in fossil fuels. Auchincloss said the company remains "uniquely positioned to add value through the energy transition towards renewables". "But that doesn't mean we automatically win. We have to constantly improve our competitiveness and keep up with customers and society," he said. Auchincloss will take over as BP CEO in 2023 following the resignation of Bernard Looney in September 2023. Looney left after being found to have failed to disclose relationships with employees.

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