BP splits into two operating units, names new leaders

BP is stripping away its three-segment structure and reorganizing around two operating units, a move that puts oil and gas at the center of the company’s next phase. Gordon Birrell will lead Upstream and Richard Harding will run Downstream on an interim basis as BP says the reset should speed decisions, cut complexity and lift shareholder value.

The split is more than an internal tidy-up. Upstream will gather BP’s exploration, development and production businesses, plus gas and carbon-capture operations, while Downstream will house refining, terminals, pipelines, mobility, convenience, biofuels, aviation, hydrogen and Castrol. Supply, Trading & Shipping will remain shared across both segments, and solar and offshore wind will sit inside the technology function, a structure that reinforces BP’s capital-light approach to renewables even as it keeps some low-carbon assets on the books.

BP said the new model will take effect on July 1 and replace the current production and operations, gas and low carbon energy, and customers and products segments. External financial reporting will remain under the current structure through December 31, 2026, with a new reporting framework beginning in fiscal 2027. That staggered timetable suggests BP wants a clean operating reset without forcing an immediate rewrite of how investors read the numbers.

For investors, the signal is hard to miss. BP is leaning further into a traditional energy profile just as it tries to rebuild trust after a turbulent stretch that included the board’s removal of chairman Albert Manifold on May 26 over governance, oversight and conduct issues. Shares fell as much as 9% that day, underscoring how closely the market is watching BP’s ability to sharpen execution and stabilize leadership.

The strategic backdrop is BP’s broader reset around returns and balance-sheet repair. In February 2025, the company set a target of about $10 billion a year in upstream oil and gas investment, annual capital spending of $13 billion to $15 billion through 2027, $4 billion to $5 billion in cost cuts by the end of 2027 and $20 billion in divestments by 2027. By February 10, 2026, BP had raised its structural cost-reduction target to $5.5 billion to $6.5 billion and said it expected about $6 billion in net proceeds from selling a 65% stake in Castrol.

The latest results point to why BP is pressing ahead. For 2025, underlying replacement-cost profit was $7.5 billion, operating cash flow reached $24.5 billion, upstream plant reliability hit a record 96.1% and refining availability reached 96.3%. BP chief executive Meg O’Neill said she had spent the past two months meeting teams, partners and investors and found strong support for the strategic direction. The reorganized BP now looks less like a climate-era experiment and more like a company trying to make its core oil, gas and refining businesses easier to run, easier to read and harder to discount.