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i've flip-flipped a bit about looney as he, himself, has flip-flipped over his strategy.
but three years or so into his appointment as ceo, i think it's fair to ask if he can take bp further forward. is he the right man for the job?
i think the extent of the green pivot was a strategic mistake and i have always thought that. the dividend cut was savage. but his performance in reducing net debt rapidly and building a much stronger balance sheet was very welcome. this is the best financial shape bp has been in for at least a decade.
but where does bp go now? looney has slowed the green pivot but his transition strategy looks increasingly muddled and his green spending wasteful. market costs in the renewables space are rising rapidly and it's just not a great time to be laying down wind turbines etc. especially outside the us, which enjoys the benefits of big subsidies via the inflation reduction act.
we need a ceo from houston who can set out a renewed vision of investment in gas and oil, in that order. we need to cut spending on renewables further and return more cash via dividends. any renewables investment needs to be much more tightly focused on returns a la wael sawan at shell.
basically we need a ceo who is not a fully signed up member of the greta fan club and give a lotta love to gas and oil.
if that means the church of england fund sells bp, ****'em.
all imho dyor
happy
Happy
I think it’s a really good time to think out the strategy for the next 5 years.
Inflation in renewables means it’s the right time to decide what works ( return wise) and what doesn’t.( also we should be better able to make these judgements from next set of results as they begin to report these)
I do like that oil production has become more important to BP,as it’s going to be around a fair while yet.
Hydrogen and Carbon Capture interest me, but time will tell if there is big money to be made there.
As for Looney, think when he took over was a very turbulent time, so you could see him try to read the future.( not many people got it right in 2020).
(Bob Dudley took over in very turbulent times,and showed he had what it takes.)
Looney has got a lot right, but the question is has it been enough.
Think it’s only in another 5 years we can truly answer that.
Just my thoughts
Morning Happy and all
I'm prepared to give Looney the benefit of doubt until 2025 to see how performing while transforming works out.
Hopefully Q2 results will put some meat on the transition bones. I also have some doubts regarding the transition and business strategy but this is mainly due to the current lack of detail. At Q1 the board said they remained confident on the transition and the other growth engine's returns on investment, as they would do, but until they can " show me the money " or much more importantly the analysts, questions and doubts will remain.
Q2 results and the strategy update will be very interesting. The move to renewable energy is irreversible in the medium to long term. With a positive update, who knows, I may revert to my previous positive thoughts of BP transitioning to a global oil and renewable giant. A BP/ORSTED super major. A vision once held by you as well I recall from distant memory !!!
The SP drop has been a disappointment but I am hopeful that we will reach that '£6 base camp' by early '24. I expect BP to rise together with oil from July/Aug onwards as SPR ends, Opec cuts kick in and peak summer demand lifts oil out of its revent trading range.
Have a great day all.
Good to see you back Mark.
Nice post, if they did get it right ,the future will be astoundingly good.
If it’s only mainly right the future will be bright.
Never ever felt that everything they did was wrong, so still feel kind of positive on the future
As far as pensioners of Bp he certainly has got it wrong
Just read the anger towards him on LinkedIn from the people who helped to make Bp what it is today
Plus he received over 10million
Good afternoon Mark
Great you are back. Missed your informative posts
Onwards and upwards :)
Missed you as well as the posts
Happyinvestor100,
I absolutely agree with what your saying. We have Shell and Exxon giving a pledge to the future, with increased oil & gas development.
We have absolute silence from Looney.
The thought of a Labour government fills me with Dred. I'm sure Milliband and all will try and hasten the demise of fossil fuels. The uncertainty will provide volatility and shareholders value destruction.
I too would like to see BP relocate to a more friendly environment, like Houston. That would inevitably see the back of Mr Looney.
Good evening meoryou & spights.
I hope that you are both well and thank you for your kind comments.
To quote Spights " onwards and upwards " from here.
Yes lets get rid of the CEO?? in the last 24 months the share price even at 450 is up 50 percent not including dividends. I don't actually know what the expectations are but if you are underwater on this share its not the CEO's fault! You need to be looking at yourselves. If Looney was to be replaced now expected a much lower share price before a higher one.
Agreed.
I don't think Looney has done anything too wrong yet. I try to read between the lines as he has to be very careful with his PR to not upset the green lobby ("cash machine" LOL).
I am certain that the energy landscape will be very different to now in a few years time, it is Looney's job to put BP in the best possible position to make the most of the new conditions. His current actions should be targeting 3 years out, so we can't say 'this is a crazy decision because electricity costs X today'.
I like BP because they trade at a discount to their peers, it's like you get the O&G business at a discount with all the transition investment FOC. In the future, when technology such as hydrogen is more integrated, BP should be in a stronger position than other companies who were not investing for so long. There will probably be a period of consolidation where all the transition malinvestment gets exposed during a downturn.
24 months ago the World was gripped by the Great Panic. The SP bombed as we were all at home. Yes, if you were smart enough with spare funds to buy in at about 220p then that is what I would call great timing. Apart from that it is not a fair comparison IMO. This has drifted about 20% over the short term and the direction of travel is in the opposite direction from previous dizzy height of 550p.