By Dhirendra Tripathi
Investing.com — BP (NYSE:BP) ADRs were up nearly 3% in Tuesday’s premarket, after the company committed to resume share buybacks and return at least 60% of surplus cash flow to shareholders
The twin promises are a result of the company achieving its $35 billion net-debt target, about a year earlier than expected. BP’s net debt at the end of 2020 was $38.9 billion. Further details relating to share buybacks will be given on April 27, the day the company will detail its first-quarter results.
The oil and gas company’s early success in meeting its debt target was driven by profits from its trading operations, a windfall of $4.7 billion from asset sales, a strong rally in crude prices since November and resilient operations. Trading profits came in part from the wild swings in crude prices that the company was able to capitalize on in the pandemic year.
The news will gladden shareholders at a time when the world opinion is turning against fossil fuels. The trend toward investing in more sustainable energy forms has weighed on Big Oil’s share prices in the last year, putting ever more pressure on them to keep churning out cash to shareholders. BP has said it too will invest in new technologies to curb climate change and harness greener forms of energy.
BP Gains On Promise to Restart Buybacks After It Hits Debt Target A Year Early
Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.