BP plc (BP.L) - Company Research

Last Updated: 28 April 2026

BP plc (LSE: BP.) is the FTSE 100 integrated oil & gas major in the middle of a high-stakes "reset". Following Murray Auchincloss’s February 2025 strategy pivot — growing upstream, focusing the downstream, slowing the energy transition — activist Elliott Investment Management disclosed a >5% stake in April 2025, the £200 m share buyback was suspended at FY25 results to accelerate balance-sheet repair, and on 18 December 2025 BP announced that Meg O’Neill (current CEO of Woodside Energy) will succeed Auchincloss as CEO from 1 April 2026, with EVP Carol Howle as interim CEO until she joins. The Q1 2026 results were published this morning (28 April 2026); the company had pre-flagged net debt rising to $25–27 bn (Q4: $22.2 bn) on a $4–7 bn working-capital build, "exceptional" oil trading offsetting weaker gas trading, and refining margins (RIM $16.9/bbl Q1 vs $15.2/bbl Q4) supporting downstream. The strategic centrepiece is the $20 bn divestment programme: announced/completed proceeds >$11 bn including the December 2025 sale of a 65% stake in Castrol to Stonepeak (enterprise value $10.1 bn, BP net proceeds ~$6 bn, expected close end-2026). This report covers the FY2025 numbers, the segment mix, the divestment programme, the supermajor competitive set and the principal risks: commodity prices, leadership turnover, debt headroom, and execution of the reset under a new CEO who has not previously run an integrated major.

1. Company Snapshot

Company	BP plc
Ticker	LSE: BP. (FTSE 100); ADR: NYSE: BP
Sector / Industry	Integrated Oil & Gas — supermajor
HQ	1 St James’s Square, London SW1Y 4PD
CEO (incoming, from 1 Apr 2026)	Meg O’Neill — currently CEO of Woodside Energy (since 2021); succeeds Murray Auchincloss who stepped down 18 Dec 2025
Interim CEO	Carol Howle (EVP, Supply, Trading & Shipping) until O’Neill joins
CFO	Kate Thomson
Chair	Helge Lund (search underway for successor; intends to stand down)
Founded	1909 (Anglo-Persian Oil Company)
Employees	~87,800 (FY24 disclosure); workforce reductions ongoing as part of reset
Fiscal year end	31 December
Share price (24 Apr 2026)	574.90p
52-week range	337.65p – 609.40p
Market cap	~£88.4 bn (~15.45 bn shares)
FY2025 revenue	$192.5 bn (-1.1% YoY)
FY2025 underlying RC profit	$7.5 bn (FY24: $8.9 bn)
Operating cash flow FY25	$24.5 bn
Net debt (31 Dec 2025)	$22.2 bn
FY2025 dividend per ordinary share	$0.0832 per share (announced policy: at least 4% growth p.a.)
Buyback	SUSPENDED at FY25 results (Feb 2026) — cash redirected to debt reduction
Q1 2026 results released	28 April 2026 (today)

2. Bull Case vs Bear Case

Bull Case	Bear Case
Strategic reset is real: $20 bn divestment programme has banked >$11 bn of announced/completed proceeds, including the December 2025 Castrol JV with Stonepeak ($10.1 bn EV, ~$6 bn cash to BP).	FY25 underlying RC profit fell to $7.5 bn from $8.9 bn; revenue $192.5 bn (-1.1%); FY24 GAAP net income only $0.39 bn (impairments and exceptionals dominate).
Q1 2026 backdrop: Brent averaged $81.13/bbl vs $63.73/bbl in Q4; BP RIM refining margin $16.9/bbl vs $15.2/bbl; oil trading "exceptional"; group underlying ETR ~35%.	Q1 2026 net debt expected $25–27 bn (Q4: $22.2 bn) on a $4–7 bn working-capital build — balance sheet repair will be slower than the headline cash flow suggests.
Activist pressure aligned with the strategy: Elliott Investment Management disclosed >5% in April 2025 calling for tighter capital discipline; FY25 buyback suspension and Castrol sale flow directly from that pressure.	Buyback suspension at FY25 results removed a key support for the equity story; dividend policy guides "at least 4% p.a." but capital returns are now smaller than at Shell or peers.
FY25 underlying production held broadly flat YoY at 2.34 mboe/d; the long-range plan is to keep upstream at ~2.3 mboe/d through 2030 — a deliberate retreat from the previous “low-carbon majors” positioning.	FY25 reset cut renewables & transition spend; 50% of Lightsource bp slated for sale; risks reputational damage with ESG investors and slows the long-dated optionality of the energy transition.
Strong shareholder base: Vanguard (~5%), Norges Bank (~3.4%), BlackRock Institutional Trust (~3.1%), large institutional float; passive flows stable.	Concurrent CEO + Chair changes: Auchincloss out (Dec 2025), Lund stepping down, O’Neill arriving 1 April 2026 with no prior supermajor experience — execution risk during the reset is acute.

3. What Does This Company Actually Do?

BP is an integrated international oil & gas major. It explores for, produces, refines, transports and markets crude oil, natural gas and refined products, with growing positions in oil & gas trading, downstream lubricants (Castrol — being part-divested), retail forecourts and convenience, EV charging (bp pulse) and renewables (Lightsource bp solar JV).

FY2025 group revenue: $192.5 bn (-1.1% YoY). BP reports under three operating segments since the 2021 restructuring:

Segment	What it does	Approx. share of group revenue
Customers & Products	Refining, marketing, retail (forecourts & convenience), Castrol lubricants, EV charging, oil trading	~75%+ (FY23 reference: $160 bn)
Gas & Low Carbon Energy	Gas production & trading, LNG, Lightsource bp solar JV, hydrogen, CCS	~15–20%
Oil Production & Operations	Upstream oil production, exploration, deepwater (GoM), Iraq, North Sea, Azerbaijan	~10%

Note: revenue mix is heavily skewed toward Customers & Products because that segment includes oil-trading and refined-products throughput valued at market price. Profitability is more evenly split, with upstream production typically the largest contributor to underlying RC profit when crude prices are firm.

FY2025 underlying production: 2,344 mboe/d (broadly flat YoY); Q1 2026 guided broadly flat vs Q4 2025.

4. The Business Model

BP’s economics are dictated by three commodity drivers (Brent, US Henry Hub gas, and refining margins) plus a globally-connected oil & gas trading book that, in good quarters, can add hundreds of millions of dollars to underlying RC profit. The "reset" announced in February 2025 explicitly reweighted capital toward upstream (where returns are higher today) and away from accelerating renewables (where returns are slower-burning).

• Upstream: ~2.3 mboe/d production target through 2030. Major positions: Gulf of Mexico deepwater, Azerbaijan (BTC, ACG), Iraq, North Sea, Oman.
• Refining & products: ~1.4 mb/d net refining capacity; bp RIM averaged $16.9/bbl in Q1 2026.
• Castrol: Lubricants brand. December 2025 deal: 65% sold to Stonepeak at $10.1 bn EV; BP nets ~$6 bn cash, retains 35% with two-year lock-up. Closing expected end-2026.
• Lightsource bp: Solar JV; 50% stake to be divested under the $20 bn programme.
• Gelsenkirchen refinery (Germany): announced for divestment.
• bp pulse: EV charging; previously aggressive expansion now slowed under the reset.
• Trading: Q1 2026 oil trading flagged "exceptional" on Middle East volatility; weak gas trading partially offset (per market commentary 14 April 2026).
• Capital discipline: Net debt target $14–18 bn by end-2027 (from $22.2 bn end-2025); buyback suspended; dividend policy “at least 4% p.a.”.

5. Financial Health

Five-year financials (FY2021–FY2025):

Metric ($bn unless noted)	FY21	FY22	FY23	FY24	FY25
Revenue	164.2	241.4	213.0	194.6	192.5
Underlying RC profit	12.8	27.7	13.8	8.9	7.5
Operating cash flow	23.6	40.9	32.0	27.3	24.5
Capex (organic)	~13	~16	~16	~16	~14
Net debt (year-end)	30.6	21.4	20.9	23.0	22.2
Dividend per ord. share ($)	~0.054	~0.066	~0.073	~0.080	0.0832
Buybacks ($)	1.7	11.7	7.9	~5	SUSPENDED

Underlying RC profit (Replacement Cost) is BP’s preferred profit measure; statutory net income for FY24 was $0.39 bn after impairments and is not directly comparable.

Recent quarterly trend:

Period	Underlying RC profit ($bn)	Production (mboe/d)	Brent avg ($/bbl)
Q1 2025	~1.4	~2.36	~75
Q2 2025	~2.4	~2.36	~67
Q3 2025	2.2	~2.34	~68
Q4 2025	1.5	2.34	63.73
Q1 2026 (released today)	Released 28 Apr 2026	~2.34 (flat guide)	81.13

Capital structure (year-end 2025): Net debt $22.2 bn; full-year operating cash flow $24.5 bn (incl. $2.9 bn working-capital build); $5.3 bn divestment + hybrid issuance proceeds during the year; buyback suspended at FY25 to "fully allocate excess cash to balance-sheet strengthening" with target net debt $14–18 bn by end-2027.

6. Valuation & Market Data

Share price (24 Apr 2026 close)	574.90p
Market cap	~£88.4 bn
Shares in issue	~15.45 bn ordinary
Enterprise value	~£105 bn (incl. ~$22 bn net debt)
52-week range	337.65p – 609.40p
Forward P/E (consensus)	~14.4×
EV / EBITDA	~4.5×
Trailing P/E	distorted by FY24 statutory net income only $0.39 bn
Dividend yield	~4.3% trailing (annual $1.96 ADR / $0.0832 per ord. share)
Price / Sales	~0.6×
Debt / Equity	~0.98
Current ratio	~1.26
Buyback status	Suspended at FY25 results (Feb 2026)
Q1 2026 results announcement	Released 7am BST 28 April 2026 (today)

Sources: Yahoo Finance, GuruFocus, MarketBeat, BP fourth quarter and full year 2025 results (Feb 2026), BP Q1 2026 trading statement (15 Apr 2026).

7. What Are They Building / What’s Coming?

• Castrol divestment – 65% to Stonepeak agreed Dec 2025; EV $10.1 bn; ~$6 bn cash to BP; expected close end-2026; BP retains 35% with two-year lock-up.
• $20 bn divestment programme – >$11 bn of completed/announced proceeds to date. Other targeted assets: Gelsenkirchen refinery (Germany), retail operations in Austria, 50% stake in Lightsource bp.
• 10% c-store divestment – BP confirmed plans to sell ~10% of company-operated convenience stores (announced 2026).
• Upstream growth projects – Kaskida (US GoM), Tiber/Paleogene tieback projects, Mad Dog Phase 3, Iraq expansion. Long-range target: ~2.3 mboe/d production through 2030.
• Hydrogen / CCS – H2Teesside (UK blue hydrogen); HyGreen Teesside (green hydrogen); Endurance CCS hub. Pace slowed under the reset, but projects continue subject to FID.
• AI / digital – BP confirms ongoing trading and reservoir-modelling AI investment; not separately disclosed in segment financials.
• Leadership transition – O’Neill (Woodside CEO) starts as group CEO 1 April 2026; Helge Lund chair-search underway. Auchincloss serves in advisory capacity until December 2026.

8. Competitive Landscape

BP is one of the “Big Five” Western supermajors plus state-owned NOCs. Production scale is the clearest comparable.

Company	2024/25 production (mboe/d)	2024 revenue ($bn)	Comment
Saudi Aramco	~12.9 (BoE/d 2025 group)	~480	State-controlled; world’s largest
ExxonMobil	~4.6	~350	Largest Western major by revenue
Shell	~2.8	~280	Closest UK-listed peer; LNG-led
Chevron	~3.4 (incl. 1.66 mb/d liquids)	~190	Permian-heavy; Hess deal closed 2025
BP	~2.34	~192.5 (FY25)	Smallest Western major by production
TotalEnergies	~2.5 (incl. 1.47 mb/d liquids)	~190	Renewables build-out continues
ConocoPhillips	~2.0	~57	Pure-play upstream

Strengths: Globally diversified upstream portfolio (Azerbaijan, GoM, Iraq, North Sea); leading commodity-trading franchise; deep retail & lubricants brand (Castrol, Aral, Amoco, ARCO).

Weaknesses: Smallest production base of the Western majors; heaviest debt-to-EBITDA among the group; FY24/25 statutory earnings depressed by impairments; Russia exit (Rosneft 19.75% stake written off in 2022) still affects mix.

9. Leadership and Ownership

Top institutional holders (April 2026):

Holder	Approx. holding	Notes
Vanguard Group	~5.0% (~792.6 m shares)	Index-linked passive base
Norges Bank (Norway SWF)	~3.4% (~543.7 m shares)	Has trimmed in last 12 months
BlackRock Institutional Trust	~3.1% (~487.3 m shares)	Stewardship voice on climate
State Street	low single-digit %	Index-linked
Elliott Investment Management	~5%	Activist disclosure April 2025; pushing capital discipline

Recent leadership changes:

Date	Event
18 Dec 2025	Murray Auchincloss steps down as CEO; Carol Howle (EVP S&T) appointed interim CEO; Meg O’Neill (Woodside CEO) named successor
1 April 2026	Meg O’Neill scheduled start as CEO
Dec 2026	Auchincloss advisory role ends
Helge Lund (Chair)	Has indicated intent to stand down; search underway

Insider transactions: No large discretionary purchases by directors disclosed in the immediately preceding window; usual scrip dividend take-up and conditional share awards continue. PDMR RNS feed is the authoritative source for BP director dealings.

10. Risks and Challenges

• Commodity price exposure — Brent and Henry Hub gas dictate quarterly outcomes. Q1 2026 backdrop ($81/bbl Brent, $5.05 HH gas) was supportive; reversal in 2H 2026 would re-pressure cash flow into the debt-paydown window.
• Leadership turnover — Concurrent CEO transition and pending chair change at the same time as a major strategic reset.
• Activist agenda — Elliott’s >5% stake (April 2025) introduces continued pressure for further capital discipline, divestments and potentially structural moves (US listing debate, etc.).
• Energy transition reversal risk — Slowing renewables and selling Lightsource bp / EV charging assets de-risks near-term margins but reduces optionality if regulation tightens.
• Litigation / legacy — Deepwater Horizon residual claims, Russia exit, Iraq political risk, climate-related litigation (e.g., Amazon, Mexico).
• Pension & decommissioning — Long-tail liabilities; FY24 statutory income compressed by non-cash items.
• Working capital and debt headroom — Q1 2026 net debt expected $25–27 bn vs $22.2 bn at YE25 driven by $4–7 bn working-capital build; targeted reduction to $14–18 bn by end-2027 depends on Castrol cash and price environment.
• Trading volatility — Strong oil-trading quarter (Q1 2026) was offset by weaker gas trading; trading P&L is inherently lumpy.
• Geopolitics — Middle East volatility helps Brent but threatens specific assets and shipping routes; Iraq operations exposed to political shifts.
• Regulatory — UK windfall tax (Energy Profits Levy) extension; EU emissions trading; US permitting changes.

11. Recent Developments

• 28 April 2026 (today): Q1 2026 results released at 7am BST. Q&A session 1pm BST hosted by Carol Howle (interim CEO), Meg O’Neill (incoming CEO from 1 Apr) and Kate Thomson (CFO).
• 15 April 2026: Q1 2026 trading statement RNS — Brent $81.13/bbl avg (vs $63.73 Q4); gas $5.05/mmBtu (vs $3.55 Q4); production broadly flat ~2.34 mboe/d; bp RIM $16.9/bbl (vs $15.2); “exceptional” oil-trading expected; net debt expected $25–27 bn (vs $22.2 bn YE25) on $4–7 bn working-capital build; group underlying ETR ~35%.
• 1 April 2026: Meg O’Neill scheduled to take over as CEO.
• Q1 2026: Adam Crozier’s appointment as Experian chair-designate (announced separately) confirmed; not BP-specific.
• February 2026: FY2025 results — revenue $192.5 bn (-1.1%); underlying RC profit $7.5 bn (FY24: $8.9 bn); operating cash flow $24.5 bn; net debt $22.2 bn; dividend $0.0832 per share with policy "at least 4% p.a. growth"; buyback suspended; FY25 production broadly flat YoY; FY24 reset announced February 2025 (grow upstream, focus downstream, reduce transition spend).
• 24 December 2025: Castrol JV with Stonepeak announced — 65% stake at $10.1 bn EV; ~$6 bn cash to BP; closing end-2026; BP retains 35% with two-year lock-up. Brings $20 bn divestment programme to ~$11 bn announced/completed proceeds.
• 18 December 2025: Murray Auchincloss steps down as CEO; Carol Howle (EVP Supply, Trading & Shipping) appointed interim CEO; Meg O’Neill (Woodside CEO) named successor effective 1 April 2026; Auchincloss advisory through December 2026.
• 22 April 2025: Elliott Investment Management discloses >5% stake in BP (Bloomberg).
• February 2025: Capital Markets Day — "growing shareholder value: a reset bp" — grow upstream, focus downstream, reduce transition spend, $20 bn divestment target by 2027.

12. Key Dates Coming Up

Date	Event
28 April 2026 (today)	Q1 2026 results & Q&A (released 7am BST)
Late July / early August 2026	Q2 2026 / interim results (typical timing)
October 2026	Q3 2026 results (typical timing)
End-2026	Castrol-Stonepeak JV expected close (~$6 bn cash inflow)
February 2027	FY2026 full-year results
2026 AGM	Date and resolutions per BP financial calendar; large governance vote anticipated given chair search
End-2027	Net debt target $14–18 bn (from $22.2 bn YE25)

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