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BP Anticipates Robust Q1 Performance Amid Trading Surge
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BP plc (BP - Free Report) , a global leader in the energy sector, anticipates robust results from its trading operations in the first quarter of 2024, with a notable uptick in oil transactions. In its latest trading update released on Tuesday, BP emphasized the positive performance of its trading arm, highlighting concurrent increases in oil and gas production and improved margins within its refining division.
According to the company's statement, the initial trading figures suggest a favorable outlook for first-quarter earnings, with BP's gas trading segment playing a pivotal role in bolstering the same. The gas marketing and trading segment of BP sustained its strong performance from the previous quarter, while the oil trading segment exhibited a stark improvement, as stated by BP.
BP anticipates a $200-$400 million decrease in revenues from lower natural gas prices, a $300-$600 million decrease from lower oil prices, and a loss worth $200 million from the devaluation of Egypt's pound compared with the prior-quarter level. Despite these setbacks, strong trading results, enhanced upstream production and favorable refining margins are anticipated to bolster first-quarter earnings.
The company foresees a $100-$200 million boost to its bottom line from robust refining margins. The upstream oil and gas output is projected to increase from the previous quarter’s level.
BP anticipates a rise in its net debt for the first quarter, primarily due to a build-up in working capital and the timing of capital expenditure and divestment proceeds.
Moreover, the trading update indicated that the impact of operational disruptions, such as the temporary halt of the Whiting refinery from Feb 1 to Mar 15, was less severe than that anticipated initially.
The resurgence of Brent crude prices beyond $90 per barrel has reignited discussions about the potential return to $100 oil in the future, further buoying the prospects for BP and its industry counterparts. BP is slated to report first-quarter results on May 7.
Murphy USA is a leading independent retailer of motor fuel and convenience merchandise in the United States.
The Zacks Consensus Estimate for MUSA’s 2024 EPS is pegged at $26.35. The company has a Zacks Style Score of B for Growth and B for Value. It has witnessed upward earnings estimate revisions for 2024 and 2025 in the past seven days.
Global Partners is a leading operator of gasoline stations and convenience stores. Over the past 60 days, GLP has witnessed upward earnings estimate revisions for 2023 and 2024.
The Zacks Consensus Estimate for Global Partners’ 2024 and 2025 EPS is pegged at $3.90 and $4.47, respectively. GLP currently has a Zacks Style Score of A for Value.
Sunoco is among the biggest motor fuel distributors in the U.S. wholesale market in terms of volumes. By distributing more than 10 fuel brands via 10,000 convenience stores under long-term distribution contracts, the partnership will continue to generate stable cash flow.
The Zacks Consensus Estimate for SUN’s 2024 EPS is pegged at $4.96. The company has witnessed upward earnings estimate revisions for 2024 and 2025 in the past 30 days.
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BP Anticipates Robust Q1 Performance Amid Trading Surge
BP plc (BP - Free Report) , a global leader in the energy sector, anticipates robust results from its trading operations in the first quarter of 2024, with a notable uptick in oil transactions. In its latest trading update released on Tuesday, BP emphasized the positive performance of its trading arm, highlighting concurrent increases in oil and gas production and improved margins within its refining division.
According to the company's statement, the initial trading figures suggest a favorable outlook for first-quarter earnings, with BP's gas trading segment playing a pivotal role in bolstering the same. The gas marketing and trading segment of BP sustained its strong performance from the previous quarter, while the oil trading segment exhibited a stark improvement, as stated by BP.
BP anticipates a $200-$400 million decrease in revenues from lower natural gas prices, a $300-$600 million decrease from lower oil prices, and a loss worth $200 million from the devaluation of Egypt's pound compared with the prior-quarter level. Despite these setbacks, strong trading results, enhanced upstream production and favorable refining margins are anticipated to bolster first-quarter earnings.
The company foresees a $100-$200 million boost to its bottom line from robust refining margins. The upstream oil and gas output is projected to increase from the previous quarter’s level.
BP anticipates a rise in its net debt for the first quarter, primarily due to a build-up in working capital and the timing of capital expenditure and divestment proceeds.
Moreover, the trading update indicated that the impact of operational disruptions, such as the temporary halt of the Whiting refinery from Feb 1 to Mar 15, was less severe than that anticipated initially.
The resurgence of Brent crude prices beyond $90 per barrel has reignited discussions about the potential return to $100 oil in the future, further buoying the prospects for BP and its industry counterparts. BP is slated to report first-quarter results on May 7.
Zacks Rank & Key Picks
BP currently carries a Zack Rank #3 (Hold).
Some better-ranked stocks in the energy sector are Murphy USA Inc. (MUSA - Free Report) , Global Partners (GLP - Free Report) and Sunoco LP (SUN - Free Report) . While Murphy USA and Global Partners sport a Zacks Rank #1 (Strong Buy) each, Sunoco LP carries a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Murphy USA is a leading independent retailer of motor fuel and convenience merchandise in the United States.
The Zacks Consensus Estimate for MUSA’s 2024 EPS is pegged at $26.35. The company has a Zacks Style Score of B for Growth and B for Value. It has witnessed upward earnings estimate revisions for 2024 and 2025 in the past seven days.
Global Partners is a leading operator of gasoline stations and convenience stores. Over the past 60 days, GLP has witnessed upward earnings estimate revisions for 2023 and 2024.
The Zacks Consensus Estimate for Global Partners’ 2024 and 2025 EPS is pegged at $3.90 and $4.47, respectively. GLP currently has a Zacks Style Score of A for Value.
Sunoco is among the biggest motor fuel distributors in the U.S. wholesale market in terms of volumes. By distributing more than 10 fuel brands via 10,000 convenience stores under long-term distribution contracts, the partnership will continue to generate stable cash flow.
The Zacks Consensus Estimate for SUN’s 2024 EPS is pegged at $4.96. The company has witnessed upward earnings estimate revisions for 2024 and 2025 in the past 30 days.