Oil & Gas

BP reported a strong financial performance for the second quarter, with underlying replacement cost profit more than doubling to $5.73 billion, exceeding analysts' expectations of $5.11 billion and rising sharply from $2.35 billion a year earlier. The increase was driven by higher oil and gas prices, stronger refining margins, and market disruptions linked to the U.S.-Iran conflict. The company also announced a 4% increase in its quarterly dividend to 8.66 cents per ordinary share.

The company is continuing to reshape its business by reducing its focus on renewable energy and strengthening its oil and gas operations. BP has started the process of selling its U.S. biogas business, Archaea, which it acquired for $4.1 billion in 2022 during its renewable energy expansion. In addition, BP has recently sold its Gelsenkirchen refinery, agreed to sell its Austrian retail business, and plans to sell its UK North Sea business.

New CEO Meg O'Neill, who took office in April, outlined five key priorities for the company: strengthening the balance sheet, simplifying the business portfolio, improving investment discipline, enhancing operational performance, and creating a faster, more accountable decision-making structure. She acknowledged that BP's recent performance had fallen short of both company and shareholder expectations, citing inconsistent results, significant write-offs, and high costs.

Looking ahead, BP expects its 2026 capital expenditure to increase to between $13.5 billion and $14 billion, reflecting delayed asset sales aimed at securing better value. The company's second-quarter results marked its strongest quarterly net profit since the third quarter of 2022, with all major business segments outperforming expectations. Its customers and products division, including the oil trading business, reported $4.95 billion in pre-tax profit, well above forecasts and significantly higher than the previous year's performance.