Shares of oil major British Petroleum (BP) are up 7% on reports that activist investor Elliott Management has built a stake in the struggling company.
Elliott Management, an activist hedge fund run by investor Paul Singer, could pressure BP to shift its current strategy and its core oil business.
The exact size of the activist stake isn’t known, but news of it comes as the British-based oil giant is about to unveil its fourth-quarter financial results.
News of the activist intervention also comes as BP’s stock has fallen 9% over the past year, underperforming many other oil stocks.
In January, BP issued an earnings pre-announcement, warning of higher corporate costs, lower fourth quarter realized refining margins and one-off charges linked to a bio-ethanol acquisition.
BP is also seeking buyers for its Ruhr Oel GmbH German refinery assets and in January revealed plans to cut 4,700 roles amid efforts to achieve $2 billion U.S. of savings.
BP has struggled with largely stagnate crude oil prices and its own ambitions in renewable energy amid the global green transition.
Elliott Management has a track record of intervention in the oil and gas industry, having previously taken a stake in Canadian energy company Suncor (SU).
At Suncor, Elliott has called for enhancements to the board and a strategic review of certain business units.
With roughly $70 billion U.S. of assets under management, Elliott is one of the world’s most prominent activist investors.
BP’s stock has declined 10% over the past five years and currently trades at $32.27 U.S. a share.
