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BP (BP) posts huge Q2 loss – but are investors still optimistic?
BP (BP) shares were up 6.56% by mid-afternoon on Tuesday as investors looked past the oil and gas company’s considerable Q2 loss and focused on recent steps to “reimagine” and “reinvent” operations for a greener and more sustainable future.
Earlier in the day, BP posted a $16.8bn loss for the latest quarter and “net earnings” of -$6.7bn, which is a record loss for the London-based energy giant and a retreat from the $800m net profit logged in Q1 2020.
Restructuring behind the scenes and the global pandemic weighed heavily during Q2.
BP said that demand for energy had plunged since March but that the challenges had prompted it to fast track its plans for cost-cutting and efficiency.
Investors were pleased to hear that BP is increasing its new investment in renewable energy sources including wind and solar to $5bn annually, which will offset its intentions to lower oil and gas output by 40%.
CEO Bernard Looney said that there had been “deliberate steps” taken to reinvent BP in Q2 against a backdrop of very challenging circumstances.
He added: “In particular, our reset of long-term price assumptions and the related impairment and exploration write-off charges had a major impact.”
BP’s hefty loss included a $10.9bn charge for non-operating items.
In a tweet on Tuesday (4th August), BP said that it wants to become a “different kind of energy company” by 2030 and will target a net-zero-carbon output by at least 2050.
The recent changes were warmly received by investors who are optimistic for the company’s future.
BP shares were up after the London stock market opened on Monday and were just above the $300 mark at 4pm BST.
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