BP CEO Looney Resigns Amid Relationship Scandal

BP CEO Bernard Looney is stepping aside immediately after failing to disclose past relationships with employees at the UK supermajor.

The abrupt exit ends what could have been a lengthy stint at the helm of BP as the company — and oil and gas industry more widely — defines its role in the energy transition. Looney, 53, worked his entire career in BP's upstream business but held the top job for less than four years.

Looney stepped into the position in 2020 with a swift shake-up of BP’s strategy and corporate culture, putting forward the industry’s most aggressive plans to shift away from oil and gas and toward renewables while shunning the “conservative oil man” stereotype.

But the Irish national will no longer have the opportunity to see those ambitions through.

BP said in a statement on Tuesday that Looney had resigned after informing the company that he was "not fully transparent" in previous disclosures "regarding past relationships" and "accepts he was obligated to make more complete disclosure."

The resignation comes as BP recently opened a second investigation into Looney's personal relationships with colleagues, "with support of external legal counsel," following fresh allegations.

Initial allegations regarding personal relationships with colleagues were first brought forward in May 2022, leading to an investigation, BP said.

That investigation found “no breach of the Company’s Code of Conduct,” BP said, but the board was “given assurances” by Looney at that time regarding his “disclosure of past personal relationships, as well as future behavior.”

BP says it has not made a decision around severance payments to Looney. The investigation into the second set of allegations is ongoing.

CFO Murray Auchincloss will take over as interim CEO while the company conducts a search for its next chief executive.

Sea of Change

Looney’s short tenure as BP CEO saw significant attempts at change — and a bit of backtracking.

He responded swiftly to Russia’s invasion of Ukraine in February 2022 by announcing that BP planned to give up its almost 20% stake in state-run Rosneft, taking a write-down of more than $25 billion. However, up to now the stake has remained in BP’s hands.

The company also recently tamped down the speed with which Looney initially pledged to shrink BP's oil and gas production amid higher-than-expected returns and still-robust global demand, relaxing certain emissions targets in the process.

The departure of Looney — known, too, for his adoption of a casual dress code and frequent social media postings — leaves BP in the lurch, with some sources pointing to the lack of a clear successor within the company.

Looney was intended to be part of a new generation of oil and gas CEOs, alongside the likes of Shell's Wael Sawan who ascended at a fairly young age and were assumed to remain in place into the next decade, offering continuity amid significant industry uncertainty.

The company is due to address Wall Street at an analyst day in Colorado in less than a month and make the case that its moderated approach to the transition is the right one.

“The work that has gone into restructuring the portfolio in the past three years and that drives free cash flow rapidly from here is set to be on show,” said Barclays analyst Lydia Rainforth in a note to clients.

But Rainforth, who has BP shares rated as “overweight,” noted that significant questions remain.

“For us, the emphasis on renewables, whilst understandable, lacked detail and did not really address the benefit of low carbon and the changes to the upstream portfolio,” she said.

The task of answering that question now falls to Auchincloss.

While a fixture of earnings calls, Auchincloss is not known for engaging with media and embracing the spotlight in the way that Looney has since taking the helm at BP.

A Canadian who began his career with Amoco as a tax analyst, Auchincloss joined BP in 1998 following the merger of the two companies and has risen steadily through a series of financial roles before being named CFO in March 2020.