May 12, 2020, 6:00 PM ETFireside Chat, Interview

Bernard Looney, Chief Executive Officer of BP

Strategic Framework: CEO Bernard Looney adopted a three-part focus to navigate the crisis: protecting people, supporting communities, and strengthening the business balance sheet.
Workforce Safety Actions:
- BP evacuated workers from remote locations, including an LNG facility in Papua where travel is a 10-hour journey; evacuation capacity was limited to 350 people per day.
- Global headcount in remote sites was reduced from an unspecified higher number to 5,000 personnel by the time of the interview.
- Retail operations in the UK and Germany were transitioned to cashless models with enhanced PPE and screen distribution for staff.
Community Interventions:
- In the US, BP launched a "Heroes Program" offering discounts to frontline responders.
- In Mauritania, BP staff assisted local populations whose water supply was cut off due to border closures with Senegal.
- BP's Houston supercomputer was diverted under a White House program to support pandemic research.
Financial Priorities: The company is prioritizing liquidity, balance sheet strengthening, and lowering its break-even cost while managing the energy transition.

Demand Shock: April 2020 witnessed a demand destruction level five times larger than during the 2008 financial crisis, described by BP CEO as "Black April."
Supply Disruption: The collapse of the OPEC+ alliance resulted in excessive supply entering the market, compounding the demand crisis.
Historical Context: Fatih Birol of the IEA predicts 2020 will be the worst year in oil history.
Forward-Looking Uncertainty:
- BP views long-term demand as the primary unknown, specifically regarding whether remote work and reduced travel behaviors will persist.
- The CEO stated, "we can never control the price of oil" and emphasizes controlling cost and capital as the strategic alternative.
Sector Trends: The transition toward clean, reliable, and affordable energy is deemed "unstoppable" by Looney, with the pandemic potentially accelerating rather than slowing this trend.

Strategic Commitment: BP announced a target to become a net-zero company by 2050 or sooner, a decision driven by explicit feedback from staff, shareholders, and activists.
Rationale for Acceleration:
- Demand Outlook: Looney finds it difficult to imagine the pandemic leading to increased oil demand, viewing it as a challenge to the oil sector.
- Ecosystem Awareness: The global realization of ecological fragility, evidenced by cleaner skies and reduced noise during lockdowns, is expected to positively impact the climate debate.
- Investor Sentiment: Despite negative oil prices (e.g., the incident where BP's 50% owned Shell subsidiary Lloyds was referenced, though context implies similar market conditions for BP's light source/solar division), clean energy assets remain resilient, with solar projects attracting debt and contracts even during market turmoil.
ESG Evolution: The pandemic has shifted focus from solely "Environmental" factors to the "Social" component of ESG, highlighting the societal role of corporations in times of need.

Mental Health Initiatives: BP made a major charitable donation to MIND, a leading mental health charity, acknowledging that the pandemic has "turbocharged" stress levels.
Categorization of Stress: Looney identified three categories of employee distress:
- Clinical depression (affecting 20–30% of society).
- Work-related stress (deadlines, reorganization).
- Life-related stress (family, finance, aging parents) affecting work performance.
Cultural Shift: The crisis has increased authenticity in leadership, with executives appearing more "real" as they are seen in home environments with children and pets, fostering greater empathy.

Economic Reconstruction: Looney advocates for "building back better," prioritizing quality of growth and investments in broadband and infrastructure over quantity of growth (e.g., new roads).
Operational Efficiency: The pandemic has demonstrated that extensive travel (e.g., flying halfway around the world) is often unnecessary, leading to improved productivity.
Trust Restoration: BP and similar institutions aim to rebuild societal trust by avoiding bailouts and making ethical decisions, even when competitors or the market pressure is high.
Personal Leadership Principle: The most impactful advice received by Looney was simply to "be nice to people and be nice to yourself," a mantra cited as crucial for navigating collective stress.