Tony Hayward, BP’s new chief executive, has given warning that Britain’s biggest company faces more pressure on earnings and cashflow as he promised to revive the flagging performance of the oil giant’s US operations.

A revenue squeeze caused by continuing troubles at BP’s US refineries cast a pall over the BP chief’s presentation of his first set of quarterly profits.

Mr Hayward said that the financial performance was “not good enough” and that BP would improve efficiency and drive down overheads. The oil company will redeploy about a quarter of the staff from its headquarters in London to frontline operations. “They are planners and they are going back to being petroleum engineers,” said Mr Hayward.

About 100 head-office staff will be affected by the streamlining initiative, which was revealed in The Times earlier this month. Further overhead cuts are expected as the efficiency drive moves out to BP’s worldwide operations.

Mr Hayward blamed the weak performance on missing revenue caused by refinery outages in the US and delayed upstream projects. Despite buoyant oil prices and a shortage of petrol in the US, BP suffered a $3 billion (£1.45 billion) fall in operating cashflow in the second quarter. Reported profits were down by 1 per cent at $6 billion, but the result was flattered with a $741 million gain from the sale of the Coryton refinery in the UK.

Mr Hayward said he was launching two initiatives after the Baker Panel report, which heavily criticised the lack of a uniform standard of process safety in BP’s US refineries. The company will impose a new “Operating Management System” throughout the group to standardise procedures.

“It is the final piece of merger integration,” Mr Hayward said, referring to the takeover of Amoco in 1998 that gave BP the Texas City refinery. The plant suffered a devastating fire in 2005 and led to several investigations, including a report by the US Chemical Safety Board that accused the company of excessive cost-cutting in the years after BP’s takeover of Amoco.

Lack of internal engineering skills was to blame for delays at BP’s Thunder Horse and Atlantis oil production platforms in the Gulf of Mexico, the company said. Mr Hayward said: “The root cause \ was the extent of in-house engineering capability. We relied too much on outsourcing.”

Thunder Horse was found listing badly after a hurricane because of the faulty operation of ballast tanks. The delay of Thunder Horse production until 2008 and the delay of Atlantis, which will not begin production until the end of 2007, has drastically cut BP’s expected revenues from oil sales.

A new training scheme, “Operating Essentials”, will ensure everyone in BP has the right skills for the job, including board executives, said Mr Hayward.

Continued weak output at the Texas City plant and at Whiting, another US refinery, has crimped BP’s revenues, profits and the cash available for distribution to its investors. Byron Grote, BP’s finance director, said that in the past share buybacks had been boosted by cash from disposals, which would be less abundant in future.

According to Iain Conn, BP’s head of refining, BP is still suffering because its plants are running well below capacity, only slightly ahead of last year’s rate of 82.5 per cent. The loss of output has prevented BP from profiting from exceptional fuel manufacturing margins, currently some $17 per barrel, caused in part by tight supplies of petrol.

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