BP More Than Doubles Profit on 'Exceptional' Oil Trading

BP PLC on Tuesday reported $3.2 billion in underlying replacement cost (RC) profit, its version of net income adjusted for nonrecurring items, for the first quarter (Q1).

That was more than double the figures for the prior three-month period and the same quarter last year. The British energy giant benefited from higher oil prices amid the war in the Middle East, while related disruptions to its production in the region was offset by the Gulf of America.

Underlying RC earnings per share for the January-March 2026 quarter stood at 20.67 cents. BP maintained its dividend per share at 8.32 cents.

Oil trading contribution was "exceptional", while that of gas marketing and trading was "average", BP said in its statement of results.

However, net debt climbed quarter-on-quarter to $25.31 billion. Gearing, the ratio of net debt to the total of net debt plus equity, increased to 24.7 percent (33.4 percent including leases).

"Overall, our business continues to run well", said chief executive Meg O'Neill, who took over from the resigned Murray Auchincloss at the start of Q2. "This 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".

BP averaged 2.34 million barrels of oil equivalent a day (MMboed) in production in Q1 2026, stable against Q4 2025 but up from Q1 2025.

BP's average price realizations increased sequentially but fell compared to Q1 2025 for both liquids and gas. In the United States, price realizations for liquids followed the same trend, while Europe saw increases by both sequential and prior-year comparisons. Gas price realizations in the U.S. increased quarter-on-quarter and year-on-year while realized gas prices in Europe dropped quarter-on-quarter and year-on-year.

"In the upstream, the heightened volatility is leading to notable differences between marker prices used in our rules of thumb and realized prices due to price lags, price caps, timing of liftings and contract structures", BP said.

In the "oil production and operations" segment, RC profit - BP's equivalent of profit attributable to shareholders under International Financial Reporting Standards - was $1.7 billion before interest and tax. That was flat quarter-on-quarter.

"After adjusting RC profit before interest and tax for a net adverse impact of adjusting items of $0.3 billion, the underlying RC profit before interest and tax for the first quarter was $2.0 billion, compared with $2.0 billion for the fourth quarter 2025. This reflects the divestment in the North Sea offset by higher realizations including the adverse impact of the price lags", BP said.

In the "gas and low-carbon energy" segment, RC profit before interest and tax was $1.1 billion, a bounce-back from the prior quarter's $2.2 billion losses.

"After adjusting RC profit before interest and tax for a net adverse impact of adjusting items of $0.3 billion, the underlying RC profit before interest and tax for the first quarter was $1.3 billion, compared with $1.4 billion in the fourth quarter 2025. This reflects realizations remaining broadly flat including the adverse impact of price lags", BP said.

In the "customers and products" segment, RC profit before interest and tax was $2.5 billion, up from $1.4 billion for Q4 2025.

"After adjusting RC profit before interest and tax for a net adverse impact of adjusting items of $0.8 billion, the underlying RC profit before interest and tax (underlying result) for the first quarter was $3.2 billion, compared with $1.3 billion in the fourth quarter 2025", BP said.

"The customers first quarter underlying result was higher by $0.1 billion, reflecting seasonally lower volumes and lower retail fuels margins, more than offset by a stronger midstream performance, including stronger supply optimization across our integrated value chain and one-off timing effects, and a lower underlying operating expenditure.

"The products first quarter underlying result was higher by $1.7 billion. In refining, the result reflects higher realized refining margins, a higher throughput driven by lower turnaround activity and the recovery following reduced capacity at the Whiting refinery in the fourth quarter, and crude selection timing effects".

The products business includes BP's oil trading activities, for which it does not disclose specific figures.

"Operating cash flow [across segments] for the quarter, after a $6.0 billion working capital build (after adjusting for inventory holding gains, fair value accounting effects and other adjusting items), was $2.9 billion", BP said.

"The working capital build of $6.0 billion reflects three main factors: around $4.1 billion related to seasonal working capital effects, higher levels of inventory reflecting longer shipping routes and the rising price environment through the quarter; $1.1 billion related to the timing of payments; and $0.8 billion of other items, primarily related to the settlement payments in the Gulf of America".

BP exited Q1 2026 with $35.69 billion in cash and cash equivalents, while current assets totaled $122.27 billion.

Current liabilities stood at $102.19 billion including $7.62 billion in finance debt.

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