BP picks new CEO following Looney sacking

BP picks new CEO following Looney sacking

Analysts say new CEO Murray Auchincloss has his work cut out to restore investor confidence in BP
Analysts say new CEO Murray Auchincloss has his work cut out to restore investor confidence in BP. Photo: Ryan LIM / AFP/File
Source: AFP

British oil giant BP on Wednesday named veteran employee Murray Auchincloss as chief executive officer following a period as interim boss in the wake of Bernard Looney's sacking.

BP's former chief financial officer Auchincloss took the reins in September after Looney resigned and was later officially sacked over his failure to disclose past relationships with colleagues.

"BP announced today that the board has appointed Murray Auchincloss as chief executive officer with immediate effect," the group said in a statement, sticking to a policy of promoting from within.

Canadian national Murray, 53, joined BP in 1998, rising to finance boss four years ago.

"The board is in complete agreement that Murray was the outstanding candidate and is the right leader for BP," chairman Helge Lund added in the statement.

Three months after Looney resigned, BP announced he had been sacked, resulting in the Irishman foregoing more than £32-million ($40-million).

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The company said Looney had "knowingly misled the board" and dismisssed him for "serious misconduct".

'Continuity' candidate

BP's shares were down 1.5 percent following the announcement, although analysts said it was mainly owing to tumbling oil prices on weak Chinese growth data and following a surprise jump to UK inflation.

London's benchmark FTSE 100 index, on which BP trades, was 1.8-percent lower overall in midday trading

Analysts pointed to the benefits of appointing Auchincloss but said he had work to do to improve BP's reputation, including over its transition away from fossil fuels.

"Auchinloss certainly has a job to do to restore investor confidence," noted Derren Nathan, head of equity research at Hargreaves Lansdown.

"Continuity of the existing strategy is no bad thing but the shape of returns from the growing focus on energy transition technologies still needs to be proved."

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As BP chief for less than four years, Looney steered the energy major through a tumultuous period that included huge swings in oil and gas prices owing to the Covid pandemic and Russia's invasion of Ukraine.

He meanwhile faced fierce criticism from environmental campaigners, who continue to accuse BP and rivals of not going far enough in their transition to producing cleaner energy.

As for Auchincloss, "there will be some disappointment about the failure to appoint an external candidate for the first time in its history to shake things up and revive a business which has trailed behind its US counterparts in recent years", noted Russ Mould, investment director at AJ Bell.

Wednesday's announcement comes ahead of BP's annual results due February 6.

The oil titan rebounded strongly into net profit in the third quarter after large accounting charges had pushed it into the red a year earlier.

Auchincloss will earn £1.45 million a year but could earn many times that amount thanks to performance-related bonuses.

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Looney became CEO in February 2020, just as the pandemic took hold around the globe, causing him to axe thousands of jobs.

While BP suffered a huge loss on its exit from Russia following the country's invasion of Ukraine, the war sent oil and gas prices soaring, handing energy majors massive revenues.

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Source: AFP

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