Shares in oil giant BP bounced this week after it promised to “shower its shareholders with higher dividends and share buybacks”, says Jillian Ambrose in The Guardian. Thanks to unexpectedly high profits of $2.76 billion for the three months to 30 June, BP will lift its dividend payments while buying back stock worth $1.75 billion over the next quarter. This will bring its total buybacks for the first half of the year to $3.5 billion and $7 billion for 2024 as a whole. BP has paid out a total of $14.8 billion to shareholders since June 2023.
All this good news is certainly a much-needed “boost” for BP’s CEO Murray Auchincloss as he “attempts to rebuild... confidence following the abrupt resignation of Bernard Looney”, says Emma Powell in The Times. Auchincloss hopes to deliver “a simpler, more focused and higher-value company”. He has set out plans to save at least $2 billion in costs by the end of 2026 and has frozen external hiring, except for frontline roles. However, investors have yet to be convinced. The company’s shares “have lagged both domestic and international rivals”.
BP's future looks bright
BP’s future prospects also look auspicious, especially since its strong results have, in addition, enabled it to take a “further bite out of its net debt pile, which now sits at $22.6 billion”, says Hargreaves Lansdown’s Derren Nathan. In addition, the group “has its eye firmly on high-returning initiatives”, having given the go-ahead for the fully owned deepwater Kaskida hub in the Gulf of Mexico, which should add 80,000 barrels per day of production once it’s up and running.
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
At the same time, the amount of energy sold through its growing EV-charging network has doubled so far this year. This “measured approach” leaves BP “well placed” to drive shareholder distributions, “while continuing to build out a strong position as an integrated energy company”.
This article was first published in MoneyWeek's magazine. Enjoy exclusive early access to news, opinion and analysis from our team of financial experts with a MoneyWeek subscription.
-
What will the unravelling of US-China trade mean for the economy?What will a US-China decoupling mean for the global economy?
-
Scottish Mortgage: why we’re turning to private companies and China for exceptional returnsWhen it comes to delivering growth, Scottish Mortgage will stop at no end in its hunt for exceptional long-term returns - this includes China, unicorn companies and sectors such as space exploration
-
The benefits of a stock bubbleOpinion We tend to think of stock bubbles as bad things but, as the dotcom craze shows, good things can come from them, says Matthew Lynn
-
Prosus to buy Just Eat for €4.1 billion as takeaway boom fadesFood-delivery platform Just Eat has been gobbled up by a Dutch rival. Now there could be further consolidation in the sector
-
Should investors stay bullish and buy UK and US stocks?Opinion Ignore the Eeyores, says Max King. The outlook for stocks in both Britain and America remains auspicious
-
Filtronic: A British stock reaching for the starsOpinion British stock Filtronic’s explosive growth is only just getting started
-
China's DeepSeek AI is a 'Sputnik moment' for the USThe US is facing a new “Sputnik moment” with the sudden appearance of China's DeepSeek AI firm wiping $1 trillion off the value of US tech stocks.
-
Luxury stocks rally after Richemont sales boom – is there hope for the sector?Cartier owner Richemont’s robust results have boosted sentiment about luxury stocks – but are investors getting carried away?
-
What investors can expect from stocks and the economy in 2025There are reasons for investors to be hopeful about 2025, with slowing interest rates and moderating oil prices. But trouble may be brewing in bond markets
-
South Korean won hits 15-year low – what it means for 'Korea discount'After Yoon Suk Yeol's failure to declare martial law, South Korean markets are reeling, with the weakest won since 2009. Will this worsen the Korea discount?
