The BP (LSE: BP.) share price has failed to sparkle since the company announced its ambitious plan to “become a net zero company by 2050 or sooner“.

The shares are down 13% in the past five years. And that’s with oil prices high, up around $85 a barrel. The reasons seem clear.

Big oil profits

Ambitious renewable energy projects have been proving more costly than expected. And oil profits right now are fatter than they’ve been for some time — and shareholders, understandably, want them.

It now looks like BP is set to refocus on hydrocarbons. The move has been made possible by the departure of previous CEO Bernard Looney in September 2023. It was Looney who committed BP to its lofty green goals.

New boss Murray Auchincloss has halted new offshore wind projects, and has put a hold on hiring. He’d previously spoken of a more pragmatic approach in January, pledging to slice $2bn off costs by 2026.

Net zero now?

BP hasn’t said as much, but observers fear the 2050 net zero target will, at least, take a back seat now. The firm has already slashed its reduction targets for oil and gas output.

The company does say that “BP’s destination – transforming from international oil company to integrated energy company – is unchanged, but we are going to deliver as a simpler, more focused and higher-value company.“

That sounds like mealy-mouthed corporate speak to me though, and doesn’t say anything clearly. But the implication is there.

Time to cheer?

The big question for us is, what difference will this make for shareholders?

On 27 June, the day the news broke, the BP share price gained half a percent. And it’s up another percent as I write the next morning. I see cautious optimism, but people aren’t piling in just yet.

Even without any potential new boost from lower costs and higher oil profits, forecasts already made BP shares look dirt cheap… at least in the short term.

We’re looking at price-to-earnings (P/E) multiples of around 7.5 and falling. And the forward dividend yield is up at 4.8% and rising.

What comes next?

The difference this latest BP move might make? I think it depends on an individual investor’s timescale.

We could well see lower costs, higher profits, and even more attractive stock valuations in the next few years. Maybe even longer.

But nothing here changes the long-term outlook for fossil fuels. Or the drive for renewable energy.

Hmm, I wonder if BP’s backing off could open the door a bit for other clean energy companies to step through?

Investing horizon

Maybe those looking ahead a few decades won’t see any reason to change their stance. And the BP share price might be terminally cheap.

Then again, billionaire Warren Buffett is still very keen on the industry.

Me? I think we might actually see a bit more bullishness towards BP now, at least in the short to medium term.