BP PLC

Non-IFRS measure. It is calculated as decreases in underlying operating

expenditure« (as defined below) as a result of operational efficiencies,

divestments, workforce reductions and other cost saving measures that

are expected to be sustainable compared with 2023 levels. The total

change between periods in underlying operating expenditure will

reflect both structural cost reductions and other changes in spend,

including market factors, such as inflation and foreign exchange

impacts, as well as changes in activity levels and costs associated with

new operations. Estimates of cumulative annual structural cost

reduction may be revised depending on whether cost reductions

realized in prior periods are determined to be sustainable compared

with 2023 levels. Structural cost reductions are stewarded internally to

support management’s oversight of spending over time.

bp believes this performance measure is useful in demonstrating how

management drives cost discipline across the entire organization,

simplifying our processes and portfolio and streamlining the way we

work. The nearest IFRS measures are production and manufacturing

expenses and distributions and administration expenses. A

reconciliation of production and manufacturing expenses plus

distribution and administration expenses to underlying operating

expenditure is provided on page 386.

We are unable to present forward-looking information of the nearest

IFRS measures, because without unreasonable efforts, we are unable to

forecast accurately certain adjusting items required to calculate a

meaningful comparable IFRS forward-looking financial measure.