BP Becomes First European Oil firm to Restart Share Buybacks After Drop in Oil Prices

Photo by: Autopistero2050 2

BP, an oil major, began a share buyback programme today, making it the first major energy company in Europe to restart buybacks since oil prices dropped in 2014.

BP originally revealed the buyback in its third-quarter results in October when it stated that it had brought its finances, including the company’s full dividend, back into “organic balance” as the firm’s profit doubled in the quarter.

The buyback programme has been scheduled for between today and the date of the annual general meeting of BP, with the maximum number of shares not to go over 1.96bn.

The buyback comes as BP recovers from the immense Deepwater Horizon oil spill in 2010. The deadly spill cost the company over $63bn (£47.8bn), and at the time BP stated that it would buy back the equivalent number of shares that it was issuing as part of its scrip dividend scheme. Investors could opt to receive dividend payouts in shares instead of cash.

The shares of BP soared to a three-year high after it revealed the share buyback in October.

The Bank cut its main interest rate after the Brexit vote because of a sharp fall in consumer and business confidence, but the potential impacts from the actual process on monetary policy are difficult to determine, said deputy governor Ben Broadbent.