BP has cut its 2020 spending plan by a quarter, from US$15bn to US$12bn, including a US$1bn reduction investment in short-cycle onshore activity; this will include its US shale business BPX Energy, which will slash its output by 70 kboe/d. In addition, BP will reduce its spending in downstream (fuels marketing, refining and petrochemicals) by around US$1bn.
The global oil price war and the coronavirus pandemic have prompted other international majors to announce significant cuts in operational costs and in capital expenditures (capex) along with the suspension of their share buyback programmes.
Shell decided to reduce its 2020 capital expenditure by US$5bn, from US$25bn to US$20bn (-20%) and its operating costs by US$3-4bn over the next 12 months compared to 2019 levels. Chevron will cut its capital expenditure by US$4bn, from US$20bn to US$16bn (-20%) and half of the investment cut will occur in upstream unconventionals (US$2bn, mainly in the Permian Basin in the United States); the company aims to reduce its operating costs by more than US$1bn by the end of 2020 and suspends its US$5bn annual share repurchase programme, after repurchasing US$1.75bn in the first quarter of 2020. Moreover, Total will reduce its capital expenditure by more than US$3bn, from US$18bn to less than US$15bn (- 20%) and its operating costs by US$800m in 2020.
