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BP Q1 Earnings Beat Estimates on Strong Oil Trading Contribution
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Key Takeaways
BP's Q1 2026 EPS rose to $1.24 per ADS, beating the 91-cent consensus by 36%.
Customers & Products profit surged on higher realized refining margins, timing effects and oil trading.
BP expects lower Q2 upstream production on GoA maintenance and Middle East disruptions; 2026 capex $13-$13.5B.
BP p.l.c. (BP - Free Report) delivered an earnings beat in the first quarter of 2026, helped by standout downstream and trading contributions. The company reported earnings of $1.24 per American Depositary Share on a replacement-cost basis, up 134.0% from 53 cents a year ago and ahead of the Zacks Consensus Estimate of 91 cents by 36.3%.
Total revenues and other income came in at $53.4 billion, higher than $47.9 billion in the prior-year period, but missing the consensus mark of $57.6 billion by 7.4%. Operationally, upstream production held at 2,339 mboe/d despite disruption impacts, while refining availability remained above the company’s 96% target.
The strong quarterly earnings can be attributed to increased upstream production, significantly higher realized refining margins and a strong oil trading contribution. The positives were partly offset by lower hydrocarbon price realizations.
BP's Profit Mix Improved on Products and Midstream Strength
BP’s underlying replacement cost profit attributable to shareholders climbed to $3.20 billion from $1.38 billion in the year-ago period, reflecting a much stronger earnings mix across the portfolio. The company also benefited from inventory holding gains of $3.18 billion (net of tax), while adjusting items were a $2.54 billion net headwind (net of tax).
A key swing factor was Customers & Products, where the underlying result in the first-quarter 2026 rose significantly from the year-earlier level. Management attributed the improvement to significantly higher realized refining margins, crude selection timing effects and an exceptional oil trading contribution, alongside stronger midstream performance.
BP’s Upstream Volumes Held Firm Despite Disruptions
In upstream, BP reported production of 2,339 mboe/d versus 2,239 mboe/d a year ago, supported by higher production in the Gulf of America and strong performance at bpx Energy. BP-operated upstream plant reliability increased to 95.7% from 95.4% in the prior quarter.
Price realizations were mixed. In gas & low carbon energy, total hydrocarbon realizations averaged $40.08 per boe, down from $45.38 a year ago, even as segment production increased to 798 mboe/d from 764 mboe/d. In oil production & operations, total hydrocarbon realizations averaged $48.51 per boe versus $56.45 a year ago, with production rising to 1,541 mboe/d from 1,475 mboe/d.
After adjusting for non-operating items, underlying replacement cost earnings before interest and tax for oil production & operations amounted to $1.98 billion. The figure was below $2.9 billion recorded in the year-ago quarter. The decline can be primarily attributed to lower realizations, a North Sea divestment and increased depreciation charges.
The underlying replacement cost profit before interest and tax for gas & low carbon energy totaled $1.34 billion compared with $997 million in the prior-year period. The increase was mainly driven by an average trading result in 2026 compared with a weak result in the corresponding period of 2025, along with higher production.
BP's Downstream Throughput Rose With High Availability
Downstream execution remained a highlight. BP-operated refining availability increased to 96.3% from 96.2% in the year-ago quarter, keeping the system above the firm’s stated target. Total refinery throughputs rose to 1,527 thousand barrels per day (mb/d) from 1,496 mb/d last year, reflecting lower turnaround activity and improved operating cadence.
The company’s total sales volume of refined products was 3,030 mb/d, down modestly from 3,054 mb/d a year ago, with regional marketing volumes softer in Europe and the rest of the world.
After adjusting for non-operating items, the underlying replacement cost earnings before interest and tax for the customers & products segment totaled $3.2 billion, significantly higher than $677 million in the corresponding period of 2025.
BP’s Cash Flows and Financials
Operating cash flow was $2.86 billion, higher than $2.83 billion a year ago, but the quarter included a $6.0 billion adjusted working-capital build. BP linked the move to seasonal inventory effects, higher inventory in transit and the rising price environment, along with payment timing and Gulf of America settlement-related items.
Capital expenditure totaled $3.29 billion versus $3.62 billion a year ago. Net debt ended the quarter at $25.31 billion, lower than $26.97 billion at the end of the first quarter of 2025. BP declared a dividend of 8.320 cents per ordinary share for the quarter. The firm also announced a gearing of 24.7% for the quarter.
BP’s 2026 Outlook
For the second quarter, BP expects reported upstream production to be lower than the first quarter due to seasonal maintenance, mainly in the Gulf of America (GoA), and disruptions in the Middle East. For the full year, BP expects reported upstream production to be lower due to Middle East disruptions.
For 2026, BP reiterated capital expenditure guidance of $13-$13.5 billion and expects divestment and other proceeds of $9-$10 billion, including about $6 billion from the announced Castrol transaction, weighted to the second half.
Equinor ASA is one of the leading integrated energy companies globally and a major supplier of natural gas in Europe. The recent conflict between the United States and Iran has resulted in a spike in gas prices and disrupted LNG supply, following damage to critical infrastructure in Qatar, tightening global LNG supply. This is expected to boost demand for Eqinor’s gas exports to Europe, positioning the company to benefit from heightened prices. The company’s expansion in the renewable energy space positions it for long-term growth as more countries transition toward cleaner energy solutions to meet their climate goals.
Galp Energia is a Portuguese energy company engaged in exploration and production activities. The company’s oil exploration efforts have yielded positive results, particularly with the Mopane discovery in the Orange Basin, offshore Namibia. This discovery allows Galp to diversify its global presence with the potential to become a significant oil producer in the region. It is engaged in refining and marketing of oil products and natural gas marketing and sales.
Subsea7 helps build underwater oil and gas fields. It is a leading player in the global offshore energy industry, providing engineering, construction and related services at offshore oil and gas fields. The long-term outlook for energy demand remains positive, and Subsea7’s focus on cost-efficient deepwater projects strengthens the position of its subsea business.
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BP Q1 Earnings Beat Estimates on Strong Oil Trading Contribution
Key Takeaways
BP p.l.c. (BP - Free Report) delivered an earnings beat in the first quarter of 2026, helped by standout downstream and trading contributions. The company reported earnings of $1.24 per American Depositary Share on a replacement-cost basis, up 134.0% from 53 cents a year ago and ahead of the Zacks Consensus Estimate of 91 cents by 36.3%.
Total revenues and other income came in at $53.4 billion, higher than $47.9 billion in the prior-year period, but missing the consensus mark of $57.6 billion by 7.4%. Operationally, upstream production held at 2,339 mboe/d despite disruption impacts, while refining availability remained above the company’s 96% target.
The strong quarterly earnings can be attributed to increased upstream production, significantly higher realized refining margins and a strong oil trading contribution. The positives were partly offset by lower hydrocarbon price realizations.
BP p.l.c. Price, Consensus and EPS Surprise
BP p.l.c. price-consensus-eps-surprise-chart | BP p.l.c. Quote
BP's Profit Mix Improved on Products and Midstream Strength
BP’s underlying replacement cost profit attributable to shareholders climbed to $3.20 billion from $1.38 billion in the year-ago period, reflecting a much stronger earnings mix across the portfolio. The company also benefited from inventory holding gains of $3.18 billion (net of tax), while adjusting items were a $2.54 billion net headwind (net of tax).
A key swing factor was Customers & Products, where the underlying result in the first-quarter 2026 rose significantly from the year-earlier level. Management attributed the improvement to significantly higher realized refining margins, crude selection timing effects and an exceptional oil trading contribution, alongside stronger midstream performance.
BP’s Upstream Volumes Held Firm Despite Disruptions
In upstream, BP reported production of 2,339 mboe/d versus 2,239 mboe/d a year ago, supported by higher production in the Gulf of America and strong performance at bpx Energy. BP-operated upstream plant reliability increased to 95.7% from 95.4% in the prior quarter.
Price realizations were mixed. In gas & low carbon energy, total hydrocarbon realizations averaged $40.08 per boe, down from $45.38 a year ago, even as segment production increased to 798 mboe/d from 764 mboe/d. In oil production & operations, total hydrocarbon realizations averaged $48.51 per boe versus $56.45 a year ago, with production rising to 1,541 mboe/d from 1,475 mboe/d.
After adjusting for non-operating items, underlying replacement cost earnings before interest and tax for oil production & operations amounted to $1.98 billion. The figure was below $2.9 billion recorded in the year-ago quarter. The decline can be primarily attributed to lower realizations, a North Sea divestment and increased depreciation charges.
The underlying replacement cost profit before interest and tax for gas & low carbon energy totaled $1.34 billion compared with $997 million in the prior-year period. The increase was mainly driven by an average trading result in 2026 compared with a weak result in the corresponding period of 2025, along with higher production.
BP's Downstream Throughput Rose With High Availability
Downstream execution remained a highlight. BP-operated refining availability increased to 96.3% from 96.2% in the year-ago quarter, keeping the system above the firm’s stated target. Total refinery throughputs rose to 1,527 thousand barrels per day (mb/d) from 1,496 mb/d last year, reflecting lower turnaround activity and improved operating cadence.
The company’s total sales volume of refined products was 3,030 mb/d, down modestly from 3,054 mb/d a year ago, with regional marketing volumes softer in Europe and the rest of the world.
After adjusting for non-operating items, the underlying replacement cost earnings before interest and tax for the customers & products segment totaled $3.2 billion, significantly higher than $677 million in the corresponding period of 2025.
BP’s Cash Flows and Financials
Operating cash flow was $2.86 billion, higher than $2.83 billion a year ago, but the quarter included a $6.0 billion adjusted working-capital build. BP linked the move to seasonal inventory effects, higher inventory in transit and the rising price environment, along with payment timing and Gulf of America settlement-related items.
Capital expenditure totaled $3.29 billion versus $3.62 billion a year ago. Net debt ended the quarter at $25.31 billion, lower than $26.97 billion at the end of the first quarter of 2025. BP declared a dividend of 8.320 cents per ordinary share for the quarter. The firm also announced a gearing of 24.7% for the quarter.
BP’s 2026 Outlook
For the second quarter, BP expects reported upstream production to be lower than the first quarter due to seasonal maintenance, mainly in the Gulf of America (GoA), and disruptions in the Middle East. For the full year, BP expects reported upstream production to be lower due to Middle East disruptions.
For 2026, BP reiterated capital expenditure guidance of $13-$13.5 billion and expects divestment and other proceeds of $9-$10 billion, including about $6 billion from the announced Castrol transaction, weighted to the second half.
BP’s Zacks Rank and Other Key Picks
BP currently carries a Zacks Rank #2 (Buy).
Some other top-ranked stocks from the energy sector are Equinor ASA (EQNR - Free Report) , Galp Energia SGPS SA (GLPEY - Free Report) and Subsea7 S.A. (SUBCY - Free Report) . While Equinor and Galp Energia sport a Zacks Rank #1 (Strong Buy), Subsea7 carries a Zacks Rank #2. You can see the complete list of today’s Zacks Rank #1 stocks here.
Equinor ASA is one of the leading integrated energy companies globally and a major supplier of natural gas in Europe. The recent conflict between the United States and Iran has resulted in a spike in gas prices and disrupted LNG supply, following damage to critical infrastructure in Qatar, tightening global LNG supply. This is expected to boost demand for Eqinor’s gas exports to Europe, positioning the company to benefit from heightened prices. The company’s expansion in the renewable energy space positions it for long-term growth as more countries transition toward cleaner energy solutions to meet their climate goals.
Galp Energia is a Portuguese energy company engaged in exploration and production activities. The company’s oil exploration efforts have yielded positive results, particularly with the Mopane discovery in the Orange Basin, offshore Namibia. This discovery allows Galp to diversify its global presence with the potential to become a significant oil producer in the region. It is engaged in refining and marketing of oil products and natural gas marketing and sales.
Subsea7 helps build underwater oil and gas fields. It is a leading player in the global offshore energy industry, providing engineering, construction and related services at offshore oil and gas fields. The long-term outlook for energy demand remains positive, and Subsea7’s focus on cost-efficient deepwater projects strengthens the position of its subsea business.