28th Apr 2026 08:52
(Alliance News) - BP PLC on Tuesday announced better-than-expected first quarter profit reflecting "exceptional" oil trading results thanks to higher energy prices.
The London-based oil major said underlying replacement cost profit ballooned to USD3.20 billion in the first quarter of 2026 from USD1.38 billion the year prior, well ahead of USD2.67 billion expected by company-compiled market consensus.
By division, underlying RC profit in Gas & Low Carbon Energy rose to USD1.34 billion from USD997 million a year before, but Oil Production & Operations fell to USD1.98 billion from USD2.90 billion.
Most significantly, Customers & Products underlying RC profit multiplied to USD3.20 billion from USD677 million. This outstripped consensus of USD2.47 billion, reflecting a stronger midstream performance and higher margins.
"The oil trading contribution for the first quarter was exceptional compared to the average result in the same period last year," BP said.
Shares in BP rose 2.4% to 586.00 pence each in London early Tuesday. It was the best performing stock on the FTSE 100 index which was up just 0.2%.
First-quarter pretax profit totalled USD7.37 billion, more than double last year's USD3.13 billion. Profit attributable to shareholders rose to USD3.84 billion from USD687 million a year before. Diluted earnings per share were 24.53 US cents compared to 4.27 cents a year ago.
Revenue rose 11% to USD52.26 billion from USD46.91 billion a year prior.
Operating cash flow edged up to USD2.86 billion from USD2.83 billion, after taking into account a USD6.0 billion adjusted working capital build largely driven by rising oil prices in addition to the seasonal inventory builds.
Net debt was reduced to USD25.31 billion as of March 31 from USD26.97 billion a year before, but was higher than USD22.18 billion on December 31.
Capital expenditure amounted to USD3.29 billion, lower than USD3.62 billion a year ago.
Chief Executive Meg O'Neill, who joined BP at the start of the month, said it was another quarter of "strong operational and financial delivery, and we made further progress towards our 2027 targets".
"We had high plant reliability, high refining availability and increased production in the Gulf of America and at bpx Energy, our US onshore business - keeping production levels steady despite the ongoing disruption," she added.
BP said the average Brent oil marker price was USD81.13 per barrel for the first quarter of 2026, up 27% from USD63.73 in the fourth quarter and 7.1% higher than USD75.73 a year ago. On Tuesday morning, Brent was trading at USD111.34 per barrel.
The oil producer said it continues to "closely monitor the situation in the Middle East", adding that the "full impact will be determined by the extent and duration of the current market conditions".
BP declared a first-quarter dividend of 8.320 US cents per share, up 4.0% from 8.000 cents a year before, or 6.226 pence, up from 6.176p.
The company reiterated its primary target of USD14 to USD18 billion of net debt by end 2027 and its 2026 capital expenditure budget in the range of USD13 billion to USD13.5 billion.
It plans to reduce its perpetual hybrid bond capital to around USD9 billion from USD13.3 billion, as a result of continued balance sheet strengthening and proceeds from disposals.
For the second quarter, BP expects reported upstream production to be lower compared with the first quarter.
In its customers business, BP expects seasonally higher volumes to be more than offset by a lower midstream result when compared to the first quarter.
In products, BP expects that, compared to the first quarter, refining throughput to be impacted by a higher level of planned refinery turnaround activity.
For 2026 as whole, BP now expects upstream production to be lower due to effects of the Middle East crisis and underlying upstream production to be broadly flat compared with 2025.
BP continues to expect sale proceeds to be around USD9 billion to USD10 billion in 2026.
By Jeremy Cutler, Alliance News reporter
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