A big upheaval in BP’s internal structure will be announced within two weeks and will include details of extensive redundancies across the group and the removal of layers of management.

The restructuring will be disclosed before the company’s third-quarter results, which are due on October 23. It will signal the determination of Tony Hayward, the new chief executive, to get to grips with an organisation that had become cluttered with bureaucracy under his predecessor, Lord Browne of Madingley.

BP stock fell 8½p yesterday as analysts cut earnings’ expectations and issued lower price targets for shares, reflecting nervousness that the company might report results that are worse than expected.

BP’s share price suffered a beating in July when Mr Hayward told investors that it faced pressure on earnings and cashflow due to a revenue squeeze on its refineries in the United States. He said then that about 100 staff would be lost from head office, with managers relocated to front-line operational jobs.

A BP source indicated yesterday that the job losses would be in patches across the whole company. “It’s a sweeping review. Tony Hayward is saying: ‘Look at everything you do. Have you got too many staff here? Have you employed too many internal communicators?’”

BP declined to comment on rumours of job losses in its Far East oil-trading business.

Last month, the chief executive repeated his warning during a pep talk to management in Houston, Texas, when he described the operational performance of the business as “dreadful”.

The market jitters yesterday led to a flurry of speculation that BP was talking down its earnings, but one leading analyst said that the company’s message had not changed since the second-quarter earnings report in July. “Quite a few people had not factored in the low refining margins,” he said.

BP is suffering from a double hit to its refineries caused by a sharp fall in refining margins in the United States and the continued weak output from two leading plants, Whiting and Texas City.

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