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BP’s board has appointed its first female chief executive in a move to revive the oil company’s fortunes, after ousting Murray Auchincloss less than two years into his role.
In an unexpected leadership shake-up, Auchincloss will step down as chief executive with immediate effect, but remain in an advisory role until the end of next year.
Auchincloss will be succeeded by Meg O’Neill, a former ExxonMobil executive and the head of the Australian oil company Woodside Energy. Carol Howle, BP’s head of trading, will run the firm until O’Neill takes up the top job in April.
The incoming oil boss will be BP’s first female chief executive in its 116-year history, and the first woman to head any of the world’s top five oil companies. Her appointment also marks the first time BP has hired an outsider for the top job.
The surprise appointment of BP’s third chief executive in five years emerged just weeks after BP appointed Albert Manifold to chair the board. Manifold replaced Helge Lund who presided over the oil company’s failed attempt to adopt a green energy agenda.
The shake-up will be taken as a sign that the British oil firm is seeking a renewed push to improve its business, with its shares and earnings lagging behind competitors such as ExxonMobil and Shell for years as it pursued green energy projects at the expense of growing its oil and gas production.
BP’s green strategy was set by its previous boss, Bernard Looney, who was appointed by Lund in 2020 to transform the business into an integrated energy company. However, the transition was undermined by a rise in global oil and gas prices, as well as the shock departure of Looney in 2023.
Looney was dismissed and denied more than £32m in pay and share awards after admitting he had failed to fully disclose to the board a series of personal relationships with his colleagues.
Auchincloss blamed the company’s “misplaced” optimism over the speed of the energy transition earlier this year and promised shareholders he would “fundamentally reset” BP by slashing billions in planned renewable energy initiatives and shifting its focus back to traditional oil and gas.
He had been under pressure since the feared New York hedge fund Elliott Investment Management took a stake in the company earlier this year. Elliott was pleased with O’Neill’s appointment, according to a source familiar with its thinking cited by the Financial Times.
Auchincloss will leave the company on Thursday. BP had not publicly announced a search process for his successor before it announced his departure late on Wednesday evening.
Manifold said: “Progress has been made in recent years, but increased rigour and diligence are required to make the necessary transformative changes to maximise value for our shareholders.”
O’Neill, who has headed Woodside since 2021, previously spent 23 years at ExxonMobil. Under her leadership, Woodside merged with BHP Group’s petroleum arm to create a top 10 global independent oil and gas producer valued at $40bn (£30bn) and doubled Woodside’s oil and gas production.
“With an extraordinary portfolio of assets, BP has significant potential to re-establish market leadership and grow shareholder value,” said O’Neill.
“This is clearly a high-profile hire, and probably some of the change that BP shareholders have been looking for,” said Dan Pickering, chief investment officer at Pickering Energy Partners.
Biraj Borkhataria, an analyst at RBC, said: “It is a little surprising to see the chairman willing to make a major change in such a short period of time, given he has little direct oil and gas experience. That said, with the activist in the shares, it felt like this move was more of a ‘when, not if’.”
Derren Nathan, head of equity research at Hargreaves Lansdown, said: “With the sector facing pressure, consolidation is the talk of the town, but BP is most frequently seen as prey rather than the hunter.
“Rival Shell has distanced itself from takeover speculation, but there are other potential suitors. O’Neill may have a fight on her hands to ensure BP’s not sold for a song, and to keep a seat at the table if it were to join forces with a competitor.”
Earlier this year, O’Neill suggested at a gas industry conference that young people who take an ideological stand against fossil fuels are hypocrites for ordering cheap online consumer goods “without any sort of recognition of the energy and carbon impact of their actions”.
Liz Westcott, who leads Woodside’s Australian operations, has taken over as its acting chief executive.
BP shares rose 1% in early trading on Thursday morning.
