REG - BP PLC - 1Q26 SEA Part 1 of 1
28/04/2026 07:00
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RNS Number : 1035C BP PLC 28 April 2026
Top of page 1
FOR IMMEDIATE RELEASE
London 28 April 2026
BP p.l.c. Group results
First quarter 2026
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Continued strong operational and financial delivery
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Continued strong operational and financial delivery
Financial summary First Fourth First
quarter quarter quarter
$ million 2026 2025 2025
Profit (loss) for the period attributable to bp shareholders 3,842 (3,422) 687
Inventory holding (gains) losses*, net of tax (3,180) 666 (118)
Replacement cost (RC) profit (loss)* 662 (2,756) 569
Net (favourable) adverse impact of adjusting items*, net of tax 2,536 4,297 812
Underlying RC profit* 3,198 1,541 1,381
Operating cash flow 2,860 7,602 2,834
Capital expenditure (3,290) (4,168) (3,623)
Divestment and other proceeds((a)) 248 3,602 328
Net debt*((b)) 25,309 22,182 26,968
Underlying operating expenditure* 5,369 5,639 5,304
Announced dividend per ordinary share (cents per share) 8.320 8.320 8.000
Underlying RC profit per ordinary share* (cents) 20.67 10.00 8.75
Underlying RC profit per ADS* (dollars) 1.24 0.60 0.53
Highlights
• Strong upstream operations: 1Q 2026 upstream plant reliability
improved to 95.7% (4Q25 95.4%); reported production broadly flat as higher
production in the Gulf of America and strong performance in bpx Energy offset
the impact of disruptions in the Middle East and a North Sea divestment at the
end of 2025.
• Improved downstream reliability; focused on running assets safely
to meet customer demand: refining availability improved to 96.3% (4Q25 96.0%)
and above our target of 96% availability.
• Strong financial performance: 1Q 2026 underlying RC profit $3.2
billion; operating cash flow $2.9 billion after taking into account a $6.0
billion adjusted working capital* build((c)) largely driven by the rising
price environment in addition to the seasonal inventory builds.
• Continued strategic progress: announced agreement to sell
Gelsenkirchen refinery. On transaction completion, our structural cost
reduction* target will increase by $1 billion to $6.5-7.5 billion by 2027.
Subject to market conditions, we now plan to reduce corporate hybrid bond
financing by around $4.3 billion to approximately $9 billion by end 2027.
It's a privilege and an honour to serve as bp's CEO. I join at a time when our
industry is operating in an environment of conflict and complexity, playing a
vital role in keeping energy flowing.
bp's team has been working relentlessly to keep our assets producing safely,
reliably and efficiently. We are working with customers and governments to get
fuel where it's needed, helping minimize disruption and the impact it can have
on people's lives.
Overall, our business continues to run well. 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.
We also made progress on sustainability, continuing to embed it in the way we
work and building on the 37% reduction in operational emissions last year,
compared to our 2019 baseline. We are committed to doing business the right
way: providing secure, affordable energy - and doing it sustainably.
bp is a great company, with highly skilled people and world-class assets. We
are heading in the right direction, strengthening the balance sheet and
continuing to accelerate delivery. Now, we have to capitalize on the
opportunity that exists across our portfolio, simplifying how we work,
unlocking growth and driving improved returns.
That is how we will make bp a simpler, stronger, more valuable company.
Meg O'Neill
Chief executive officer
(a) Divestment proceeds are disposal proceeds as per the condensed group
cash flow statement.
(b) See Note 9 for more information.
(c) Change in working capital adjusted for inventory holding gains, fair
value accounting effects relating to subsidiaries and other adjusting items.
See page 26.
RC profit (loss), underlying RC profit, net debt, underlying operating
expenditure, underlying RC profit per ordinary share, underlying RC profit per
ADS and adjusted working capital are non-IFRS measures. Inventory holding
(gains) losses and adjusting items are non-IFRS adjustments.
Definitions are provided in the Glossary on page 30. Non-IFRS measures are
marked with an asterisk.
Top of page 2
Highlights
1Q26 underlying replacement cost (RC) profit* $3.2 billion
• Underlying RC profit for the quarter of $3.2 billion, compared with $1.5
billion for the previous quarter. Compared with the fourth quarter 2025, the
underlying result reflects exceptional oil trading contribution and stronger
midstream performance. The underlying effective tax rate (ETR)* in the quarter
was 32%, compared with 43% for the previous quarter, which reflects changes in
the geographical mix of profits.
• Reported profit for the quarter was $3.8 billion, compared with a loss of
$3.4 billion for the fourth quarter 2025. The reported result for the first
quarter is adjusted for inventory holding gains* of $3.2 billion (net of tax)
and a net adverse impact of adjusting items* of $2.5 billion (net of tax) to
derive the underlying RC profit. Adjusting items include adverse pre-tax fair
value accounting effects of $1.1 billion and post-tax net impairments of $0.4
billion (see page 25 for more information on adjusting items).
Segment results
• Gas & low carbon energy: The RC profit before interest and tax for the
first quarter 2026 was $1.1 billion, compared with a loss of $2.2 billion
for the previous 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 $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. The gas marketing and trading result was average.
• Oil production & operations: The RC profit before interest and tax for the
first quarter 2026 was $1.7 billion, compared with $1.7 billion for the
previous 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.
• Customers & products: The RC profit before interest and tax for the first
quarter 2026 was $2.5 billion, compared with $1.4 billion for the previous
quarter. 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. 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 oil trading contribution was
exceptional.
Operating cash flow $2.9 billion and net debt* $25.3 billion
• Operating cash flow 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. 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.
• Net debt increased to $25.3 billion at the end of the first quarter compared
with $22.2 billion at the end of the fourth quarter 2025, primarily driven by
lower operating cash flow.
Our financial frame
• Our first capital allocation priority is a resilient dividend, which is
expected to increase by at least 4% per ordinary share a year((a).) For the
first quarter, bp has announced a dividend per ordinary share of 8.320 cents.
• We are committed to strengthening the balance sheet and continue to target
improving our credit metrics within an 'A' grade credit range. We reiterate
our primary target of $14 to 18 billion of net debt by end 2027. When
considering our capital structure, we also look at other instruments including
hybrid bonds and securities or obligations such as leases and our Gulf of
America settlement liabilities.
• bp's hybrid capital includes a notional $13.3 billion of perpetual hybrid
bonds made up of a core stack of around $12.0 billion and $1.3 billion issued
in 2024 as prefinancing of upcoming redemptions. bp now plans to reduce its
perpetual hybrid bond capital to approximately $9 billion, subject to
market conditions, as a result of continued balance sheet strengthening and
the receipt of cash from our divestment programme. This $4.3 billion reduction
is expected to be achieved through the redemption, without replacement, of
perpetual hybrid bonds with first call dates in March 2026 of €2.5 billion
and March 2027 of £1.25 billion. Following completion of these actions, the
remaining $9 billion of perpetual hybrid bonds are currently intended to
remain a permanent component of bp's capital framework.
• We reiterate our 2026 capital expenditure budget in the range of $13-13.5
billion.
(a) Shareholder distributions, including dividends are subject to board
discretion, taking into account factors including, but not limited to, current
forecasts and credit metrics.
The commentary above contains forward-looking statements and should be read in
conjunction with the cautionary statement on page 36.
Top of page 3
Financial results
In addition to the highlights on page 2:
• Profit attributable to bp shareholders in the first quarter was
$3.8 billion, compared with $0.7 billion in the same period of 2025.
- After adjusting profit attributable to bp shareholders for inventory holding
gains* and net impact of adjusting items*, underlying replacement cost (RC)
profit* for the first quarter was $3.2 billion, compared with $1.4 billion
for the same period of 2025. The underlying RC profit for the first quarter
compared with the same period in 2025 mainly reflects significantly higher
realized margins, partly offset by lower realizations. The oil trading
contribution for the first quarter was exceptional compared with the average
result in the same period of 2025 and the gas marketing and trading result was
average compared with the weak result for the same period in 2025. See pages
6, 8 and 10 for more information.
- Adjusting items in the first quarter had a net adverse pre-tax impact of
$2.0 billion, compared with a net adverse pre-tax impact of $0.4 billion in
the same period of 2025.
- Adjusting items for the first quarter includes an adverse pre-tax impact of
fair value accounting effects* of $1.1 billion, compared with a favourable
pre-tax impact of $1.0 billion in the same period of 2025. In both the gas
& low carbon energy and customers & products segments fair value
accounting effects represent the difference in treatment between, management's
internal performance measure and IFRS. In other businesses & corporate,
there was an adverse impact of the fair value accounting effects relating to
the hybrid bonds in the first quarter 2026 compared with a favourable impact
in the first quarter 2025.
• The effective tax rate (ETR) on the profit before taxation for the first
quarter was 43%, compared with 69% for the same period in 2025. Excluding
inventory holding gains or losses and adjusting items, the underlying ETR* for
the first quarter was 32%, compared with 50% for the same period in 2025. The
lower underlying ETR for the first quarter reflects changes in the
geographical mix of profits, particularly due to the higher results in
products. Underlying ETR is a non-IFRS measure.
• Operating cash flow for the first quarter was $2.9 billion, compared
with $2.8 billion for the same period in 2025.
• Capital expenditure in the first quarter was $3.3 billion, compared
with $3.6 billion in the same period of 2025.
• Total divestment and other proceeds for the first quarter were
$0.2 billion, compared with $0.3 billion for the same period in 2025.
• At the end of the first quarter, net debt* was $25.3 billion, compared
with $22.2 billion at the end of the fourth quarter 2025 and $27.0 billion
at the end of the first quarter 2025.
Top of page 4
Analysis of RC profit (loss) before interest and tax and reconciliation to
profit (loss) for the period
First Fourth First
quarter quarter quarter
$ million 2026 2025 2025
RC profit (loss) before interest and tax
gas & low carbon energy 1,054 (2,172) 1,358
oil production & operations 1,655 1,735 2,788
customers & products 2,452 1,415 103
other businesses & corporate (855) (386) (22)
Consolidation adjustment - UPII* 21 21 13
RC profit before interest and tax 4,327 613 4,240
Finance costs and net finance expense relating to pensions and other (1,121) (1,242) (1,269)
post-employment benefits
Taxation on a RC basis (2,174) (1,830) (2,107)
Non-controlling interests (370) (297) (295)
RC profit (loss) attributable to bp shareholders* 662 (2,756) 569
Inventory holding gains (losses)* 4,159 (874) 159
Taxation (charge) credit on inventory holding gains and losses (979) 208 (41)
Profit (loss) for the period attributable to bp shareholders 3,842 (3,422) 687
Analysis of underlying RC profit (loss) before interest and tax
First Fourth First
quarter quarter quarter
$ million 2026 2025 2025
Underlying RC profit (loss) before interest and tax
gas & low carbon energy 1,336 1,389 997
oil production & operations 1,981 1,958 2,895
customers & products 3,203 1,346 677
other businesses & corporate (272) (304) (117)
Consolidation adjustment - UPII 21 21 13
Underlying RC profit before interest and tax 6,269 4,410 4,465
Finance costs on an underlying RC basis((a)) and net finance expense relating (1,047) (1,162) (1,082)
to pensions and other post-employment benefits
Taxation on an underlying RC basis (1,654) (1,410) (1,707)
Non-controlling interests (370) (297) (295)
Underlying RC profit attributable to bp shareholders* 3,198 1,541 1,381
(a) A non-IFRS measure. Finance costs on an underlying RC basis is
defined as finance costs as stated in the group income statement excluding
finance costs classified as adjusting items* (see footnote (d) on page 25).
Reconciliations of underlying RC profit attributable to bp shareholders to the
nearest equivalent IFRS measure are provided on page 1 for the group and on
pages 6-12 for the segments.
Operating Metrics
First Fourth First
quarter quarter quarter
2026 2025 2025
Tier 1 and tier 2 process safety events 7 4 10
upstream production((a)) (mboe/d) 2,339 2,344 2,239
upstream unit production costs((b)) ($/boe) 6.39 5.82 6.34
bp-operated upstream plant reliability 95.7% 95.4% 95.4%
bp-operated refining availability((a)) 96.3% 96.0% 96.2%
(a) See Operational updates on pages 6, 8 and 10. Because of rounding,
upstream production may not agree exactly with the sum of gas & low carbon
energy and oil production & operations.
(b) The increase in the first quarter 2026, compared with the first
quarter 2025 mainly reflects portfolio mix.
Top of page 5
Outlook & Guidance
2Q 2026 guidance
• Looking ahead, bp expects second quarter 2026 reported upstream
production to be lower compared with the first quarter 2026, due to seasonal
maintenance predominantly in the Gulf of America and the effects of disruption
in the Middle East. The heightened volatility in the oil and gas prices could
also impact PSA contracts.
• In its customers business, bp expects compared to the first quarter,
seasonally higher volumes to be more than offset by a lower midstream result,
including the potential reversal of the 1Q timing effects. We expect volumes
and fuels margins to remain sensitive to conditions and developments in the
Middle East.
• In products, bp expects compared to the first quarter, refining
throughput to be impacted by a higher level of planned refinery turnaround
activity. We also expect lower throughput at Whiting due to a third-party
event this month which has now been resolved. Refining margins are expected to
remain sensitive to the cost of supply and conditions in the Middle East.
• bp plans to reduce its hybrid capital in the second quarter 2026 through
the redemption, without replacement, of €2.5 billion of perpetual hybrid
bonds.
2026 guidance
In addition to the guidance on page 2:
• bp now expects reported upstream production to be lower due to effects
of disruption in the Middle East and underlying upstream production to be
broadly flat compared with 2025. Within this, bp expects underlying production
from oil production & operations to be broadly flat and production from
gas & low carbon energy to be lower.
• In its customers business, bp continues to expect to make continued
progress growing cash flows, supported by lower underlying operating
expenditure* driven by structural cost reductions*. These benefits will be
partly offset by the earnings impact of completed and announced divestments.
Reported earnings will benefit from lower depreciation as a result of the
assets held for sale accounting treatment of Castrol following the planned
divestment. Fuel margins are expected to remain sensitive to movements in the
cost of supply.
• In products, bp continues to expect significantly lower level of
turnaround activity. Refining margins are expected to remain sensitive to the
cost of supply and conditions in the Middle East.
• bp continues to expect other businesses & corporate underlying
annual charge to be around $1.0 billion for 2026. The charge may vary quarter
to quarter.
• bp continues to expect the depreciation, depletion and amortization to
be broadly flat compared with 2025.
• bp continues to expect the underlying ETR* for 2026 to be around 40% but
it is sensitive to a range of factors, including the volatility of the price
environment and its impact on the geographical mix of the group's profits and
losses.
• bp continues to expect capital expenditure to be $13-13.5 billion and
now evenly weighted through the year.
• bp continues to expect divestment and other proceeds to be $9-10 billion
in 2026, including approximately $6 billion from the announced Castrol
transaction, all significantly weighted to the second half.
• bp continues to expect Gulf of America settlement payments for the year
to be around $1.6 billion pre-tax including $0.4 billion pre-tax paid during
the first quarter and $1.1 billion pre-tax paid during the second quarter.
Middle East implications
We continue to closely monitor the situation in the Middle East. The full
impact will be determined by the extent and duration of the current market
conditions.
2025 upstream production Crude oil Natural gas Total hydrocarbons
(bp share, net of royalties) (mb/d) (mmcf/d) (mboe/d)
Subsidiaries
Abu Dhabi 208 - 208
Oman 22 590 124
Equity-accounted entities
Iraq 79 - 79
Total 309 590 411
• 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.
• In refining, we are seeing margin dislocations driven by three main
factors: crude differentials, product yields and freight costs.
The commentary above contains forward-looking statements and should be read in
conjunction with the cautionary statement on page 36.
Top of page 6
gas & low carbon energy
Financial results
• The replacement cost (RC) profit before interest and tax for
the first quarter was $1,054 million, compared with $1,358 million for the
same period in 2025. The first quarter is adjusted by an adverse impact of net
adjusting items* of $282 million, compared with a favourable impact of net
adjusting items of $361 million for the same period in 2025. Adjusting items
include the impacts of fair value accounting effects*, relative to
management's internal measure of performance, which are an adverse impact of
$273 million for the first quarter in 2026 and a favourable impact of $668
million for the same period in 2025. See page 25 for more information on
adjusting items.
• After adjusting RC profit before interest and tax for
adjusting items, the underlying RC profit before interest and tax* for the
first quarter was $1,336 million, compared with $997 million for the same
period in 2025.
• The underlying RC profit before interest and tax for the first
quarter reflects an average trading result compared to a weak result for the
same period in 2025, and higher production offset by lower realizations.
Operational update
• Reported production for the quarter was 798mboe/d, 4.5% higher
than the same period in 2025. Underlying production was 5.5% higher compared
with the first quarter of 2025 reflecting major project start-ups partly
offset by base decline.
Strategic progress
• In March bp and South Valley Egyptian Petroleum Holding
Company signed a memorandum of understanding for the award of Block (6) in the
Red Sea.
• In April bp announced a significant gas and condensate
discovery offshore Egypt following the successful drilling of the Denise W-1
exploration well in the Temsah Concession, located in the Eastern
Mediterranean. The Denise W-1 well follows a binding head of agreement signed
in July 2025 with EGPC and EGAS for a 20-year renewal of the Temsah
Concession.
• In April Arcius, a joint venture with bp holding 51% and XRG
holding 49%, has taken a final investment decision to develop the Harmattan
gas field in Egypt's El Burg offshore concession, a significant step toward
executing one of its first projects in Egypt.
First Fourth First
quarter quarter quarter
$ million 2026 2025 2025
Profit (loss) before interest and tax 1,054 (2,172) 1,358
Inventory holding (gains) losses* - - -
RC profit (loss) before interest and tax 1,054 (2,172) 1,358
Net (favourable) adverse impact of adjusting items 282 3,561 (361)
Underlying RC profit before interest and tax 1,336 1,389 997
Taxation on an underlying RC basis (473) (463) (471)
Underlying RC profit before interest 863 926 526
First Fourth First
quarter quarter quarter
$ million 2026 2025 2025
Depreciation, depletion and amortization
Total depreciation, depletion and amortization 1,186 1,173 1,166
Exploration write-offs
Exploration write-offs - - -
Adjusted EBITDA*
Total adjusted EBITDA 2,522 2,562 2,163
Capital expenditure
gas 635 757 774
low carbon energy 60 132 129
Total capital expenditure 695 889 903
Top of page 7
gas & low carbon energy (continued)
First Fourth First
quarter quarter quarter
2026 2025 2025
Production (net of royalties)((a))
Liquids (mb/d) 87 86 83
Natural gas (mmcf/d) 4,124 4,074 3,950
Total hydrocarbons (mboe/d) 798 788 764
Average realizations((b))
Liquids ($/bbl) 67.17 62.72 70.74
Natural gas ($/mcf) 6.30 6.30 7.26
Total hydrocarbons ($/boe) 40.08 39.18 45.38
(a) Includes bp's share of production of equity-accounted entities in
the gas & low carbon energy segment.
(b) Realizations are based on sales by consolidated subsidiaries only -
this excludes equity-accounted entities.
Top of page 8
oil production & operations
Financial results
• The replacement cost (RC) profit before interest and tax for
the first quarter was $1,655 million, compared with $2,788 million for the
same period in 2025. The first quarter is adjusted by an adverse impact of net
adjusting items* of $326 million, compared with an adverse impact of net
adjusting items of $107 million for the same period in 2025. See page 25 for
more information on adjusting items.
• After adjusting RC profit before interest and tax for
adjusting items, the underlying RC profit before interest and tax* for the
first quarter was $1,981 million, compared with $2,895 million for the same
period in 2025.
• The underlying RC profit before interest and tax for the first
quarter, compared with the same period in 2025, primarily reflects lower
realizations including the impact of price lags, divestment in the North Sea
and increased depreciation charges.
Operational update
• Reported production for the quarter was 1,541mboe/d, 4.5%
higher than the first quarter of 2025. Underlying production for the quarter
was 5.9% higher compared with the first quarter of 2025 primarily reflecting
bpx Energy performance.
Strategic progress
• In February Aker BP started oil production from the Solveig
Phase 2 (formally called Utsira High) development in the North Sea (bp
interest in Aker BP 15.9%). The project has been delivered on schedule, adding
approximately 39 million barrels of oil equivalent in recoverable resources to
the Solveig field.
• In February bp confirmed an oil discovery in the Algaita-01
exploration well offshore Angola. The well was drilled in Block 15/06, and is
operated by Azule Energy, a 50:50 joint venture between bp and Eni.
• In February bp announced the start-up of the Ndungu
full-field, part of the Agogo Integrated West Hub Project (IWH), in the
western area of Block 15/06, offshore Angola. Agogo IWH is operated by Azule
Energy.
• In March bp was the apparent highest bidder on three blocks in
the BBG-2 Gulf of America lease sale.
• In March bp confirmed start-up of gas production from the
Quiluma field, part of the New Gas Consortium in Angola, operated by Azule
Energy.
• In April bp agreed to acquire a 60% interest in three offshore
exploration blocks in Namibia from Eco Atlantic Oil & Gas. Subject to
Namibian government approvals, bp will be the operator of three blocks -
PEL97, PEL99 and PEL100 - offshore Namibia in the Walvis Basin, with Eco
Atlantic remaining a partner, along with Namibia's national oil company
NAMCOR.
First Fourth First
quarter quarter quarter
$ million 2026 2025 2025
Profit before interest and tax 1,662 1,735 2,795
Inventory holding (gains) losses* (7) - (7)
RC profit before interest and tax 1,655 1,735 2,788
Net (favourable) adverse impact of adjusting items 326 223 107
Underlying RC profit before interest and tax 1,981 1,958 2,895
Taxation on an underlying RC basis (854) (918) (1,375)
Underlying RC profit before interest 1,127 1,040 1,520
First Fourth First
quarter quarter quarter
$ million 2026 2025 2025
Depreciation, depletion and amortization
Total depreciation, depletion and amortization 2,009 2,038 1,787
Exploration write-offs
Exploration write-offs 2 25 53
Adjusted EBITDA*
Total adjusted EBITDA 3,992 4,021 4,735
Capital expenditure
Total capital expenditure 1,891 1,636 1,696
Top of page 9
oil production & operations (continued)
First Fourth First
quarter quarter quarter
2026 2025 2025
Production (net of royalties)((a))
Liquids (mb/d) 1,126 1,134 1,086
Natural gas (mmcf/d) 2,407 2,442 2,258
Total hydrocarbons (mboe/d) 1,541 1,555 1,475
Average realizations((b))
Liquids ($/bbl) 59.75 56.09 67.50
Natural gas ($/mcf) 3.57 3.19 4.74
Total hydrocarbons ($/boe) 48.51 44.98 56.45
(a) Includes bp's share of production of equity-accounted entities in
the oil production & operations segment.
(b) Realizations are based on sales by consolidated subsidiaries only -
this excludes equity-accounted entities.
Top of page 10
customers & products
Financial results
• The replacement cost (RC) profit before interest and tax for
the first quarter was $2,452 million, compared with $103 million for the same
period in 2025. The first quarter is adjusted by an adverse impact of net
adjusting items* of $751 million, compared with an adverse impact of net
adjusting items of $574 million for the same period in 2025. See page 25 for
more information on adjusting items.
• After adjusting RC profit before interest and tax for
adjusting items, the underlying RC profit before interest and tax* (underlying
result) for the first quarter was $3,203 million, compared with $677 million
for the same period in 2025.
• The customers & products underlying result for the first
quarter was significantly higher compared with the same period in 2025.
• customers - the customers underlying result for the first
quarter was higher compared with the same period in 2025, reflecting a
stronger midstream performance, including stronger supply optimization across
our integrated value chain and one-off timing effects, partly offset by lower
retail fuels margins.
• products - the products underlying result for the first
quarter was significantly higher compared with the same period in 2025. In
refining, the first quarter benefited from significantly higher realized
margins and crude selection timing effects.
The oil trading contribution for the first quarter was exceptional compared to
the average result in the same period last year.
Operational update
• bp-operated refining availability for the first quarter was
96.3%, higher compared with 96.2% for the same period in 2025.
Strategic progress
• In March bp announced the agreed sale of its Gelsenkirchen
refinery and related businesses in Germany to the Klesch Group. The
transaction supports portfolio simplification and progress toward structural
cost reduction* targets. Subject to conditions including regulatory and
governmental approvals, the transaction is expected to close in the second
half of 2026.
• Air bp signed a multi‑year supply agreement with Airbus to
provide jet fuel and sustainable aviation fuel (SAF), as well as aviation
services in Germany and Spain.
• In January bp and Castrol commenced their Formula 1
partnership with Audi during the start of the season. This reflects the
outcome of several years of bp and Castrol fuels and lubricants research and
development to support compliance with the new 2026 Formula 1 regulations. The
partnership showcases our strengths in technology and innovation and helps
build brand equity.
First Fourth First
quarter quarter quarter
$ million 2026 2025 2025
Profit before interest and tax 6,604 541 255
Inventory holding (gains) losses* (4,152) 874 (152)
RC profit before interest and tax 2,452 1,415 103
Net (favourable) adverse impact of adjusting items 751 (69) 574
Underlying RC profit before interest and tax 3,203 1,346 677
Of which:((a))
customers - convenience & mobility 1,009 877 664
Castrol - included in customers 346 227 238
products - refining & trading 2,194 469 13
Taxation on an underlying RC basis (646) (379) (76)
Underlying RC profit before interest 2,557 967 601
(a) A reconciliation to RC profit before interest and tax by business is
provided on page 28.
Top of page 11
customers & products (continued)
First Fourth First
quarter quarter quarter
$ million 2026 2025 2025
Adjusted EBITDA*((b))
customers - convenience & mobility 1,541 1,492 1,231
Castrol - included in customers 346 262 284
products - refining & trading 2,626 909 431
4,167 2,401 1,662
Depreciation, depletion and amortization
Total depreciation, depletion and amortization 964 1,055 985
Capital expenditure
customers - convenience & mobility 367 1,122 585
Castrol - included in customers 15 51 37
products - refining & trading 290 439 358
Total capital expenditure 657 1,561 943
(b) A reconciliation to RC profit before interest and tax by business is
provided on page 28.
First Fourth First
quarter quarter quarter
Marketing sales of refined products (mb/d) 2026 2025 2025
US 1,172 1,197 1,201
Europe 923 998 946
Rest of World 458 478 466
2,553 2,673 2,613
Trading/supply sales of refined products 477 497 441
Total sales volume of refined products 3,030 3,170 3,054
bp average refining indicator margin (RIM) ($/bbl) 16.9 15.2 8.1
Refinery throughputs (mb/d)
US 682 611 674
Europe 845 849 822
Total refinery throughputs 1,527 1,460 1,496
bp-operated refining availability (%) 96.3 96.0 96.2
Top of page 12
other businesses & corporate
Other businesses & corporate comprises technology, bp ventures, shipping,
our corporate activities & functions and any residual costs of the Gulf of
America oil spill.
Financial results
• The replacement cost (RC) loss before interest and tax for the
first quarter was $855 million, compared with a loss of $22 million for the
same period in 2025. The first quarter is adjusted by an adverse impact of net
adjusting items* of $583 million, compared with a favourable impact of net
adjusting items of $95 million for the same period in 2025. Adjusting items
include adverse impacts of fair value accounting effects* of $218 million for
the first quarter, and a favourable impact of $369 million for the same period
in 2025. See page 25 for more information on adjusting items.
• After adjusting RC loss before interest and tax for adjusting
items, the underlying RC loss before interest and tax* for the first quarter
was $272 million, compared with a loss of $117 million for the same period in
2025.
First Fourth First
quarter quarter quarter
$ million 2026 2025 2025
Profit (loss) before interest and tax (855) (386) (22)
Inventory holding (gains) losses* - - -
RC profit (loss) before interest and tax (855) (386) (22)
Net (favourable) adverse impact of adjusting items((a)) 583 82 (95)
Underlying RC profit (loss) before interest and tax (272) (304) (117)
Taxation on an underlying RC basis 124 151 33
Underlying RC profit (loss) before interest (148) (153) (84)
(a) Includes fair value accounting effects relating to hybrid bonds. See
page 31 for more information.
Top of page 13
Financial statements
Group income statement
First Fourth First
quarter quarter quarter
$ million 2026 2025 2025
Sales and other operating revenues (Note 5) 52,255 47,383 46,905
Earnings from joint ventures - after interest and tax 323 (1,044) 327
Earnings from associates - after interest and tax 353 239 249
Interest and other income 338 452 385
Gains on sale of businesses and fixed assets 102 712 14
Total revenues and other income 53,371 47,742 47,880
Purchases 26,250 28,014 27,720
Production and manufacturing expenses 8,537 6,759 6,114
Production and similar taxes 429 406 447
Depreciation, depletion and amortization (Note 6) 4,410 4,526 4,183
Net impairment and losses on sale of businesses and fixed assets (Note 3) 589 3,624 503
Exploration expense 44 104 103
Distribution and administration expenses 4,626 4,570 4,411
Profit (loss) before interest and taxation 8,486 (261) 4,399
Finance costs 1,175 1,289 1,321
Net finance (income) expense relating to pensions and other post-employment (54) (47) (52)
benefits
Profit (loss) before taxation 7,365 (1,503) 3,130
Taxation 3,153 1,622 2,148
Profit (loss) for the period 4,212 (3,125) 982
Attributable to
bp shareholders 3,842 (3,422) 687
Non-controlling interests 370 297 295
4,212 (3,125) 982
Earnings per share (Note 7)
Profit (loss) for the period attributable to bp shareholders
Per ordinary share (cents)
Basic 24.83 (22.21) 4.35
Diluted 24.53 (22.21) 4.27
Per ADS (dollars)
Basic 1.49 (1.33) 0.26
Diluted 1.47 (1.33) 0.26
Top of page 14
Condensed group statement of comprehensive income
First Fourth First
quarter quarter quarter
$ million 2026 2025 2025
Profit (loss) for the period 4,212 (3,125) 982
Other comprehensive income
Items that may be reclassified subsequently to profit or loss
Currency translation differences((a)) (191) (3) 819
Exchange (gains) losses on translation of foreign operations reclassified to - 19 -
gain or loss on sale of businesses and fixed assets
Cash flow hedges and costs of hedging 159 37 (185)
Share of items relating to equity-accounted entities, net of tax 7 (3) 1
Income tax relating to items that may be reclassified (14) (4) 42
(39) 46 677
Items that will not be reclassified to profit or loss
Remeasurements of the net pension and other post-employment benefit liability 119 109 331
or asset
Remeasurements of equity investments (1) (7) (1)
Cash flow hedges that will subsequently be transferred to the balance sheet 3 2 2
Income tax relating to items that will not be reclassified (37) (28) (95)
84 76 237
Other comprehensive income 45 122 914
Total comprehensive income 4,257 (3,003) 1,896
Attributable to
bp shareholders 3,916 (3,293) 1,556
Non-controlling interests 341 290 340
4,257 (3,003) 1,896
(a) First quarter 2025 is principally affected by movements in the Pound
Sterling against the US dollar.
Top of page 15
Condensed group statement of changes in equity
bp shareholders' Non-controlling interests Total
$ million equity Hybrid bonds Other interest equity
At 1 January 2026 53,052 15,955 4,993 74,000
Total comprehensive income 3,916 185 156 4,257
Dividends (1,280) - (171) (1,451)
Cash flow hedges transferred to the balance sheet, net of tax (1) - - (1)
Repurchase of ordinary share capital (114) - - (114)
Share-based payments, net of tax 374 - - 374
Payments on perpetual hybrid bonds (1) (106) - (107)
Transactions involving non-controlling interests, net of tax 16 - (13) 3
At 31 March 2026 55,962 16,034 4,965 76,961
bp shareholders' Non-controlling interests Total
$ million equity Hybrid bonds Other interest equity
At 1 January 2025 59,246 16,649 2,423 78,318
Total comprehensive income 1,556 197 143 1,896
Dividends (1,265) - (74) (1,339)
Cash flow hedges transferred to the balance sheet, net of tax (1) - - (1)
Repurchase of ordinary share capital (1,753) - - (1,753)
Share-based payments, net of tax 432 - - 432
Issue of perpetual hybrid bonds - 500 - 500
Payments on perpetual hybrid bonds - (103) - (103)
Transactions involving non-controlling interests, net of tax - - 2 2
At 31 March 2025 58,215 17,243 2,494 77,952
Top of page 16
Group balance sheet
31 March 31 December
$ million 2026 2025
Non-current assets
Property, plant and equipment 97,209 98,633
Goodwill 10,276 10,300
Intangible assets 8,294 8,197
Investments in joint ventures 13,563 13,400
Investments in associates 7,497 7,325
Other investments 795 857
Fixed assets 137,634 138,712
Loans 2,077 1,991
Trade and other receivables 2,575 2,376
Derivative financial instruments 20,001 20,957
Prepayments 636 608
Deferred tax assets 3,463 4,325
Defined benefit pension plan surpluses 7,716 7,771
174,102 176,740
Current assets
Loans 541 457
Inventories 36,596 22,499
Trade and other receivables 34,435 26,014
Derivative financial instruments 10,323 5,180
Prepayments 3,603 3,422
Current tax receivable 1,005 1,153
Other investments 70 158
Cash and cash equivalents 35,693 36,556
122,266 95,439
Assets classified as held for sale (Note 2) 5,375 6,347
127,641 101,786
Total assets 301,743 278,526
Current liabilities
Trade and other payables 67,581 56,843
Derivative financial instruments 11,061 4,413
Accruals 4,824 5,572
Lease liabilities 2,898 2,832
Finance debt 7,624 3,356
Current tax payable 2,072 1,262
Provisions 6,134 4,709
102,194 78,987
Liabilities directly associated with assets classified as held for sale (Note 2,512 1,594
2)
104,706 80,581
Non-current liabilities
Other payables 7,857 7,975
Derivative financial instruments 19,054 19,667
Accruals 1,951 1,834
Lease liabilities 11,459 11,739
Finance debt 52,197 54,602
Deferred tax liabilities 7,684 7,642
Provisions 15,743 15,670
Defined benefit pension plan and other post-employment benefit plan deficits 4,131 4,816
120,076 123,945
Total liabilities 224,782 204,526
Net assets 76,961 74,000
Equity
bp shareholders' equity 55,962 53,052
Non-controlling interests 20,999 20,948
Total equity 76,961 74,000
Top of page 17
Condensed group cash flow statement
First Fourth First
quarter quarter quarter
$ million 2026 2025 2025
Operating activities
Profit (loss) before taxation 7,365 (1,503) 3,130
Adjustments to reconcile profit (loss) before taxation to net cash provided by
operating activities
Depreciation, depletion and amortization and exploration expenditure written 4,412 4,551 4,236
off
Net impairment and (gain) loss on sale of businesses and fixed assets 487 2,912 489
Earnings from equity-accounted entities, less dividends received (367) 1,461 (200)
Net charge for interest and other finance expense, less net interest paid 35 486 147
Share-based payments 318 197 401
Net operating charge for pensions and other post-employment benefits, less (29) (9) (11)
contributions and benefit payments for unfunded plans
Net charge for provisions, less payments 2,357 (416) 1,104
Movements in inventories and other current and non-current assets and (10,542) 1,785 (5,069)
liabilities
Income taxes paid (1,176) (1,862) (1,393)
Net cash provided by operating activities 2,860 7,602 2,834
Investing activities
Expenditure on property, plant and equipment, intangible and other assets (3,242) (3,463) (3,351)
Acquisitions, net of cash acquired (14) (642) (202)
Investment in joint ventures (22) (22) (58)
Investment in associates (12) (41) (12)
Total cash capital expenditure (3,290) (4,168) (3,623)
Proceeds from disposal of fixed assets 159 498 292
Proceeds from disposal of businesses, net of cash disposed 102 1,604 36
Proceeds from loan repayments 32 63 31
Cash provided from investing activities 293 2,165 359
Net cash used in investing activities (2,997) (2,003) (3,264)
Financing activities
Net issue (repurchase) of shares (Note 7) (562) (826) (1,847)
Lease liability payments (764) (764) (727)
Proceeds from long-term financing 67 487 54
Repayments of long-term financing (845) (2,231) (1,366)
Net increase (decrease) in short-term debt 3,112 (361) (125)
Issue of perpetual hybrid bonds - - 500
Payments relating to perpetual hybrid bonds (237) (308) (272)
Payments relating to transactions involving non-controlling interests (Other (13) - -
interest)
Receipts relating to transactions involving non-controlling interests (Other - 1,501 -
interest)
Dividends paid - bp shareholders (1,278) (1,276) (1,257)
- non-controlling interests (175) (150) (74)
Net cash provided by (used in) financing activities (695) (3,928) (5,114)
Currency translation differences relating to cash and cash equivalents (109) (2) 106
Increase (decrease) in cash and cash equivalents (941) 1,669 (5,438)
Cash and cash equivalents at beginning of period(a) 36,658 34,955 39,269
Cash and cash equivalents at end of period(b) 35,717 36,624 33,831
(a) First quarter 2026 reflects the adoption of amendments to IFRS 9
'Financial Instruments'. See note 1.
(b) First quarter 2026 includes $24 million (fourth quarter 2025 $68
million, first quarter 2025 $57 million) of cash and cash equivalents
classified as assets held for sale in the group balance sheet.
Top of page 18
Notes
Note 1. Basis of preparation
The interim financial information included in this report has been prepared in
accordance with IAS 34 'Interim Financial Reporting'.
The results for the interim periods presented herein are unaudited and, in the
opinion of management, include all adjustments necessary for a fair
presentation of the results for each period. All such adjustments are of a
normal recurring nature. This report should be read in conjunction with the
consolidated financial statements and related notes for the year ended 31
December 2025 included in bp Annual Report and Form 20-F 2025.
bp prepares its consolidated financial statements included within bp Annual
Report and Form 20-F on the basis of United Kingdom adopted international
accounting standards and IFRS Accounting Standards® (IFRS) as issued by the
International Accounting Standards Board (IASB), IFRS as adopted by the
European Union (EU), and in accordance with the provisions of the UK Companies
Act 2006 as applicable to companies reporting under international accounting
standards. IFRS as adopted by the UK does not differ from IFRS as adopted by
the EU. IFRS as adopted by the UK and EU differ in certain respects from IFRS
as issued by the IASB. The differences have no impact on the group's
consolidated financial statements for the periods presented. The financial
information presented herein has been prepared in accordance with the
accounting policies expected to be used in preparing bp Annual Report and Form
20-F 2026, which are the same as those used in preparing bp Annual Report and
Form 20-F 2025.
New standards and amendments to IFRS
On 1 January 2026, bp adopted the amendments to IFRS 9 'Financial Instruments'
relating to the settlement of liabilities through electronic payment systems
using the modified retrospective approach. The impact to the interim financial
information upon transition was $34 million increase to cash and cash
equivalents.
Significant accounting judgements and estimates
bp's significant accounting judgements and estimates were disclosed in bp
Annual Report and Form 20-F 2025. These have been subsequently considered at
the end of this quarter to determine if any changes were required to those
judgements and estimates.
Considerations in respect of the conflict in the Middle East and impact on the
economic environment
The impact of the conflict in the Middle East and the associated economic
developments have been considered for the basis of preparation for the interim
financial information. Such factors include the economic effect of price
volatility, supply disruptions in the region, operability of producing assets
and discount rates.
Impairment testing assumptions
As a result of the recent and ongoing conflict in the Middle East and the
related economic impact, the group's value-in-use impairment testing price
assumptions for Brent oil and Henry Hub gas were revised during the first
quarter from those disclosed in the bp Annual Report and Form 20-F 2025. The
group has updated its estimate of Brent oil prices to $82.80/bbl (previously
$70.00/bbl) and Henry Hub gas prices to $3.00/mmBtu (previously $3.80/mmBtu)
in real 2024 terms for the full year 2026. With reference to the Brent price,
this estimate assumes that the ongoing supply disruptions as a result of the
conflict in the Middle East resolve before the year end 2026. With regard to
the Henry Hub gas price assumption, the price decrease is based on an
expectation of oversupply in 2026 in the US domestic market. The post-tax
discount rate used for value-in-use impairment testing of assets other than
certain low carbon energy assets was maintained at 8% (31 December 2025 8%).
No material impairment or reversal of impairment arose in the first quarter
2026 interim period as a result of the changes to these commodity price
assumptions.
Provisions
The nominal risk-free discount rate applied to provisions is reviewed on a
quarterly basis. The discount rate applied to the group's provisions remains
at 4.5% (31 December 2025 4.5%).
Top of page 19
Note 2. Non-current assets held for sale
The carrying amount of assets classified as held for sale at 31 March 2026 is
$5,375 million, with associated liabilities of $2,512 million.
Gas & low carbon energy
On 24 October 2024, bp completed the acquisition of the remaining 50.03% of
Lightsource bp. The acquisition included certain assets for which sales
processes were in progress at the acquisition date. The sale of some of these
assets completed during the first quarter of 2026 with the remaining expected
to complete in 2026. The carrying amount of assets classified as held for sale
at 31 March 2026 is $930 million, with associated liabilities of $584 million.
Customers & products
On 18 March 2026, bp agreed with the Klesch Group to divest its 100% interest
in the Gelsenkirchen refinery and associated assets. The transaction is
expected to complete during the second half of 2026, subject to regulatory
approvals. The carrying amount of assets classified as held for sale at 31
March 2026 is $31 million, with associated liabilities of $1,617 million.
Net working capital has not been classified as assets and associated
liabilities held for sale. Working capital balances, including inventory, as
at completion will be transferred to the buyer.
On 24 December 2025, bp announced an agreement with Stonepeak to divest a 65%
shareholding in the Castrol business with bp retaining a 35% interest through
a holding in a newly incorporated entity. Cash proceeds are estimated at $6
billion. The transaction is expected to complete by the end of 2026, subject
to regulatory approvals. The carrying amount of assets classified as held for
sale at 31 March 2026 is $4,414 million including $2,704 million of goodwill
that arose on the acquisition of Castrol in 2000, with associated liabilities
of $311 million. Net working capital has not been classified as assets and
associated liabilities held for sale. The working capital balances, including
inventory, as at completion will be transferred to the buyer. The shares to be
held by Stonepeak after the transaction closes are subject to preferred
distributions, the effect of which is that bp does not expect to recognize
income or dividends from the investment in the short to medium term.
Note 3. Impairment and losses on sale of businesses and fixed assets
Net impairment charges and losses on sale of businesses and fixed assets for
the first quarter were $589 million, compared with net charges of
$503 million for the same period in 2025 and include net impairment charges
for the first quarter of $360 million, compared with net impairment charges
of $431 million for the same period in 2025.
Top of page 20
Note 4. Analysis of replacement cost profit (loss) before interest and tax and
reconciliation to profit (loss) before taxation
First Fourth First
quarter quarter quarter
$ million 2026 2025 2025
gas & low carbon energy 1,054 (2,172) 1,358
oil production & operations 1,655 1,735 2,788
customers & products 2,452 1,415 103
other businesses & corporate (855) (386) (22)
4,306 592 4,227
Consolidation adjustment - UPII* 21 21 13
RC profit (loss) before interest and tax 4,327 613 4,240
Inventory holding gains (losses)*
gas & low carbon energy - - -
oil production & operations 7 - 7
customers & products 4,152 (874) 152
Profit (loss) before interest and tax 8,486 (261) 4,399
Finance costs 1,175 1,289 1,321
Net finance expense/(income) relating to pensions and other post-employment (54) (47) (52)
benefits
Profit (loss) before taxation 7,365 (1,503) 3,130
RC profit (loss) before interest and tax*
US 1,521 (895) 1,533
Non-US 2,806 1,508 2,707
4,327 613 4,240
Top of page 21
Note 5. Sales and other operating revenues
First Fourth First
quarter quarter quarter
$ million 2026 2025 2025
By segment
gas & low carbon energy 9,447 10,728 10,778
oil production & operations 5,952 5,740 6,502
customers & products 42,961 36,474 36,163
other businesses & corporate 561 582 484
58,921 53,524 53,927
Less: sales and other operating revenues between segments
gas & low carbon energy 347 454 731
oil production & operations 5,600 5,332 5,818
customers & products 475 (14) 42
other businesses & corporate 244 369 431
6,666 6,141 7,022
External sales and other operating revenues
gas & low carbon energy 9,100 10,274 10,047
oil production & operations 352 408 684
customers & products 42,486 36,488 36,121
other businesses & corporate 317 213 53
Total sales and other operating revenues 52,255 47,383 46,905
By geographical area
US 19,476 17,652 19,089
Non-US 42,577 37,686 35,701
62,053 55,338 54,790
Less: sales and other operating revenues between areas 9,798 7,955 7,885
52,255 47,383 46,905
Revenues from contracts with customers
Sales and other operating revenues include the following in relation to
revenues from contracts with customers:
Crude oil 333 592 415
Oil products 29,851 28,199 27,162
Natural gas, LNG and NGLs 6,637 6,973 7,263
Non-oil products and other revenues from contracts with customers 3,695 4,274 3,633
Revenue from contracts with customers 40,516 40,038 38,473
Other operating revenues((a)) 11,739 7,345 8,432
Total sales and other operating revenues 52,255 47,383 46,905
(a) Principally relates to commodity derivative transactions including
sales of bp own production in trading books.
Top of page 22
Note 6. Depreciation, depletion and amortization
First Fourth First
quarter quarter quarter
$ million 2026 2025 2025
Total depreciation, depletion and amortization by segment
gas & low carbon energy 1,186 1,173 1,166
oil production & operations 2,009 2,038 1,787
customers & products 964 1,055 985
other businesses & corporate 251 260 245
4,410 4,526 4,183
Total depreciation, depletion and amortization by geographical area
US 1,879 1,780 1,736
Non-US 2,531 2,746 2,447
4,410 4,526 4,183
Note 7. Earnings per share and shares in issue
Basic earnings per ordinary share (EpS) amounts are calculated by dividing the
profit (loss) for the period attributable to ordinary shareholders by the
weighted average number of ordinary shares outstanding during the period.
Against the authority granted at bp's 2025 annual general meeting, 74 million
ordinary shares repurchased were settled during the first quarter 2026 for a
total cost of $450 million. All of these shares were held as treasury shares.
The calculation of EpS is performed separately for each discrete quarterly
period, and for the year-to-date period. As a result, the sum of the discrete
quarterly EpS amounts in any particular year-to-date period may not be equal
to the EpS amount for the year-to-date period.
For the diluted EpS calculation the weighted average number of shares
outstanding during the period is adjusted for the number of shares that are
potentially issuable in connection with employee share-based payment plans
using the treasury stock method.
First Fourth First
quarter quarter quarter
$ million 2026 2025 2025
Results for the period
Profit (loss) for the period attributable to bp shareholders 3,842 (3,422) 687
Less: preference dividend - - -
Profit (loss) attributable to bp ordinary shareholders 3,842 (3,422) 687
Number of shares (thousand)((a)(b))
Basic weighted average number of shares outstanding 15,471,646 15,409,755 15,778,296
ADS equivalent((c)) 2,578,607 2,568,292 2,629,716
Weighted average number of shares outstanding used to calculate diluted 15,662,113 15,409,755 16,097,610
earnings per share
ADS equivalent((c)) 2,610,352 2,568,292 2,682,935
Shares in issue at period-end 15,496,882 15,377,210 15,785,972
ADS equivalent((c)) 2,582,813 2,562,868 2,630,995
(a) If the inclusion of potentially issuable shares would decrease loss
per share, the potentially issuable shares are excluded from the weighted
average number of shares outstanding used to calculate diluted earnings per
share. The numbers of potentially issuable shares that have been excluded from
the calculation for the fourth quarter 2025 are 251,360 thousand (ADS
equivalent 41,893 thousand).
(b) Excludes treasury shares and includes certain shares that will be
issued in the future under employee share-based payment plans.
(c) One ADS is equivalent to six ordinary shares.
Top of page 23
Note 8. Dividends
Dividends payable
bp today announced an interim dividend of 8.320 cents per ordinary share which
is expected to be paid on 26 June 2026 to ordinary shareholders and American
Depositary Share (ADS) holders on the register on 15 May 2026. The ex-dividend
date will be 14 May 2026 for ordinary shareholders and 15 May 2026 for ADS
holders. The corresponding amount in sterling is due to be announced on 9 June
2026, calculated based on the average of the market exchange rates over three
dealing days between 3 June 2026 and 5 June 2026. Holders of ADSs are expected
to receive $0.4992 per ADS (less applicable fees). The board has decided not
to offer a scrip dividend alternative in respect of the first quarter 2026
dividend. Ordinary shareholders and ADS holders (subject to certain
exceptions) will be able to participate in a dividend reinvestment programme.
Details of the first quarter dividend and timetable are available at
bp.com/dividends and further details of the dividend reinvestment programmes
are available at bp.com/drip.
First Fourth First
quarter quarter quarter
2026 2025 2025
Dividends paid per ordinary share
cents 8.320 8.320 8.000
pence 6.226 6.239 6.176
Dividends paid per ADS (cents) 49.92 49.92 48.00
Note 9. Net debt
Net debt* 31 March 31 December 31 March
$ million 2026 2025 2025
Finance debt((a)) 59,821 57,958 58,646
Fair value (asset) liability of hedges related to finance debt((b)) 1,181 780 2,096
61,002 58,738 60,742
Less: cash and cash equivalents 35,693 36,556 33,774
Net debt((c)) 25,309 22,182 26,968
Total equity 76,961 74,000 77,952
Gearing* 24.7% 23.1% 25.7%
(a) The fair value of finance debt at 31 March 2026 was $56,331 million
(31 December 2025 $54,935 million, 31 March 2025 $55,064 million).
(b) Derivative financial instruments entered into for the purpose of
managing foreign currency exchange risk associated with net debt with a fair
value liability position of $101 million at 31 March 2026 (fourth quarter
2025 liability of $94 million and first quarter 2025 liability of
$137 million) are not included in the calculation of net debt shown above as
hedge accounting is not applied for these instruments.
(c) Net debt does not include accrued interest, which is reported within
other receivables and other payables on the balance sheet and for which the
associated cash flows are presented as operating cash flows in the group cash
flow statement.
Note 10. Statutory accounts
The financial information shown in this publication, which was approved by the
Board of Directors on 27 April 2026, is unaudited and does not constitute
statutory financial statements. Audited financial information will be
published in bp Annual Report and Form 20-F 2026. bp Annual Report and Form
20-F 2025 has been filed with the Registrar of Companies in England and Wales.
The report of the auditor on those accounts was unqualified, did not include a
reference to any matters to which the auditor drew attention by way of
emphasis without qualifying the report and did not contain a statement under
section 498(2) or section 498(3) of the UK Companies Act 2006.
Top of page 24
Additional information
Capital expenditure
Capital expenditure is a measure that provides useful information to
understand how bp's management allocates resources including the investment of
funds in projects which expand the group's activities through acquisition.
First Fourth First
quarter quarter quarter
$ million 2026 2025 2025
Capital expenditure
Organic capital expenditure* 3,276 3,524 3,440
Inorganic capital expenditure*((a)) 14 644 183
3,290 4,168 3,623
First Fourth First
quarter quarter quarter
$ million 2026 2025 2025
Capital expenditure by segment
gas & low carbon energy((a)) 695 889 903
oil production & operations 1,891 1,636 1,696
customers & products 657 1,561 943
other businesses & corporate 47 82 81
3,290 4,168 3,623
Capital expenditure by geographical area
US 1,602 1,529 1,433
Non-US 1,688 2,639 2,190
3,290 4,168 3,623
(a) Fourth quarter 2025 includes the final payment for the bp Bunge
Bioenergia acquisition.
Top of page 25
Adjusting items*
Adjusting items are items that management considers to be important to
period-on-period analysis of the group's results and are disclosed in order to
enable investors to better understand and evaluate the group's reported
financial performance. Adjusting items are used as a reconciling adjustment to
derive underlying RC profit or loss and related underlying measures which are
non-IFRS measures.
First Fourth First
quarter quarter quarter
$ million 2026 2025 2025
gas & low carbon energy
Gains on sale of businesses and fixed assets 1 190 (1)
Net impairment and losses on sale of businesses and fixed assets (56) (3,154) (366)
Environmental and related provisions - - -
Restructuring, integration and rationalization costs (13) 1 (14)
Fair value accounting effects((a)(b)) (273) 453 668
Other((c)) 59 (1,051) 74
(282) (3,561) 361
oil production & operations
Gains on sale of businesses and fixed assets 67 231 9
Net impairment and losses on sale of businesses and fixed assets (155) (217) (15)
Environmental and related provisions (170) (37) (31)
Restructuring, integration and rationalization costs (66) 11 (41)
Fair value accounting effects - - -
Other (2) (211) (29)
(326) (223) (107)
customers & products
Gains on sale of businesses and fixed assets 33 288 3
Net impairment and losses on sale of businesses and fixed assets (134) (253) (114)
Environmental and related provisions (3) (66) -
Restructuring, integration and rationalization costs (60) (47) (91)
Fair value accounting effects((b)) (593) 34 (82)
Other 6 113 (290)
(751) 69 (574)
other businesses & corporate
Gains on sale of businesses and fixed assets 1 3 -
Net impairment and losses on sale of businesses and fixed assets (244) - (5)
Environmental and related provisions - (182) (72)
Restructuring, integration and rationalization costs (110) 35 (198)
Fair value accounting effects((b)) (218) 61 369
Gulf of America oil spill (4) (4) (9)
Other (8) 5 10
(583) (82) 95
Total before interest and taxation (1,942) (3,797) (225)
Finance costs((d)) (74) (80) (187)
Total before taxation (2,016) (3,877) (412)
Taxation on adjusting items((e)(f)) (520) (418) 139
Taxation - tax rate change effect((g)) - (2) (539)
Total after taxation for period (2,536) (4,297) (812)
(a) Under IFRS bp marks-to-market the value of the hedges used to
risk-manage LNG contracts, but not the contracts themselves, resulting in a
mismatch in accounting treatment. The fair value accounting effect includes
the change in value of LNG contracts that are being risk managed, and the
underlying result reflects how bp risk-manages its LNG contracts.
(b) For further information, including the nature of fair value accounting
effects reported in each segment, see pages 3, 6 and 31.
(c) Fourth quarter 2025 includes $1,007 million impairment charges
recognized through equity-accounted earnings primarily relating to the Archaea
and offshore wind businesses.
(d) Includes the unwinding of discounting effects relating to Gulf of
America oil spill payables, the income statement impact of temporary valuation
differences related to the group's interest rate and foreign currency exchange
risk management associated with finance debt, and the unwinding of discounting
effects relating to certain onerous contract provisions.
(e) Includes certain foreign exchange effects on tax as adjusting items.
These amounts represent the impact of: (i) foreign exchange on deferred tax
balances arising from the conversion of local currency tax base amounts into
functional currency, and (ii) taxable gains and losses from the retranslation
of US dollar-denominated intra-group loans to local currency.
Top of page 26
(f) First quarter 2026 and fourth quarter 2025 include the impact of the
reassessment of the recognition of deferred tax assets. Fourth quarter 2025
also includes limited tax relief on impairment charges.
(g) First quarter 2025 includes a revision to the deferred tax impact of
the introduction of the UK Energy Profits Levy (EPL) on temporary differences
existing at the opening balance sheet date. The EPL increases the headline
rate of tax on taxable profits from bp's North Sea business to 78%. In the
first quarter 2025 a two-year extension of the EPL to 31 March 2030 was
substantively enacted.
Net debt including leases*
Gearing including leases and net debt including leases are non-IFRS measures
that provide the impact of the group's lease portfolio on net debt and
gearing.
Net debt including leases 31 March 31 December 31 March
$ million 2026 2025 2025
Net debt* 25,309 22,182 26,968
Lease liabilities 14,357 14,571 12,484
Net partner (receivable) payable for leases entered into on behalf of joint (1,072) (1,067) (91)
operations
Net debt including leases 38,594 35,686 39,361
Total equity 76,961 74,000 77,952
Gearing including leases* 33.4% 32.5% 33.6%
Gulf of America oil spill
31 March 31 December
$ million 2026 2025
Gulf of America oil spill payables and provisions (6,938) (7,256)
Of which - current (1,137) (1,522)
Deferred tax asset 1,034 1,110
Payables and provisions presented in the table above reflect the latest
estimate for the remaining costs associated with the Gulf of America oil
spill. Where amounts have been provided on an estimated basis, the amounts
ultimately payable may differ from the amounts provided and the timing of
payments is uncertain. Further information relating to the Gulf of America oil
spill, including information on the nature and expected timing of payments
relating to provisions and other payables, is provided in bp Annual Report and
Form 20-F 2025 - Financial statements - Notes 7, 22, 23, 29, and 33.
Working capital* reconciliation
Change in working capital adjusted for inventory holding gains/losses*, fair
value accounting effects* relating to subsidiaries and other adjusting items
is a non-IFRS measure. It represents what would have been reported as
movements in inventories and other current and non-current assets and
liabilities, if the starting point in determining net cash provided by
operating activities had been underlying replacement cost profit rather than
profit for the period.
First Fourth First
quarter quarter quarter
$ million 2026 2025 2025
Movements in inventories and other current and non-current assets and (10,542) 1,785 (5,069)
liabilities as per condensed group cash flow statement((a))
Adjusted for inventory holding gains (losses) (Note 4) 4,159 (874) 159
Adjusted for fair value accounting effects relating to subsidiaries (1,101) 608 959
Other adjusting items((b)) 1,454 (594) 601
Working capital release (build) after adjusting for net inventory holding (6,030) 925 (3,350)
gains (losses), fair value accounting effects and other adjusting items
(a) The movement in working capital includes outflows relating to the
Gulf of America oil spill on a pre-tax basis of $396 million in the first
quarter 2026 (fourth quarter 2025 $1 million, first quarter 2025
$2 million).
(b) Other adjusting items relate to the non-cash movement of US emissions
obligations carried as a provision that will be settled by allowances held as
inventory.
Top of page 27
Underlying operating expenditure* reconciliation
Underlying operating expenditure is a non-IFRS measure and a subset of
production and manufacturing expenses plus distribution and administration
expenses and excludes costs that are classified as adjusting items. It
represents the majority of the remaining expenses in these line items but
excludes certain costs that are variable, primarily with volumes (such as
freight costs).
Management believes that underlying operating expenditure is a performance
measure that provides investors with useful information regarding the
company's financial performance because it considers these expenses to be the
principal operating and overhead expenses that are most directly under their
control although they also include certain foreign exchange and commodity
price effects.
First Fourth First
quarter quarter quarter
$ million 2026 2025 2025
From group income statement
Production and manufacturing expenses 8,537 6,759 6,114
Distribution and administration expenses 4,626 4,570 4,411
13,163 11,329 10,525
Less certain variable costs:
Transportation and shipping costs((a)) 3,083 2,797 2,446
Environmental costs((a)) 2,399 1,456 1,337
Marketing and distribution costs 767 486 427
Commission, storage and handling costs 399 413 366
Other variable costs and non-cash costs 503 433 297
Certain variable costs and non-cash costs 7,151 5,585 4,873
Adjusted operating expenditure* 6,012 5,744 5,652
Less certain adjusting items*:
Gulf of America oil spill 4 4 9
Environmental and related provisions 173 285 103
Restructuring, integration and rationalization costs 249 - 344
Fair value accounting effects - derivative instruments relating to the hybrid 218 (61) (369)
bonds
Other certain adjusting items (1) (123) 261
Certain adjusting items 643 105 348
Underlying operating expenditure 5,369 5,639 5,304
(a) First quarter 2025 has been restated for a reclassification in costs
from transportation and shipping to environmental.
Top of page 28
Reconciliation of customers & products RC profit before interest and tax
to underlying RC profit before interest and tax* to adjusted EBITDA* by
business
First Fourth First
quarter quarter quarter
$ million 2026 2025 2025
RC profit before interest and tax for customers & products 2,452 1,415 103
Less: Adjusting items* gains (charges) (751) 69 (574)
Underlying RC profit before interest and tax for customers & products 3,203 1,346 677
By business:
customers - convenience & mobility 1,009 877 664
Castrol - included in customers 346 227 238
products - refining & trading 2,194 469 13
Add back: Depreciation, depletion and amortization 964 1,055 985
By business:
customers - convenience & mobility 532 615 567
Castrol - included in customers - 35 46
products - refining & trading 432 440 418
Adjusted EBITDA for customers & products 4,167 2,401 1,662
By business:
customers - convenience & mobility 1,541 1,492 1,231
Castrol - included in customers 346 262 284
products - refining & trading 2,626 909 431
Top of page 29
Realizations and marker prices
First Fourth First
quarter quarter quarter
2026 2025 2025
Average realizations((a))
Liquids ($/bbl)
US 51.20 49.08 62.01
Europe 85.35 61.84 75.31
Rest of World 68.74 66.55 74.59
bp average 60.43 56.61 67.79
Natural gas ($/mcf)
US 3.36 2.53 3.15
Europe 8.76 9.28 16.47
Rest of World 6.30 6.30 7.26
bp average 5.37 5.21 6.40
Total hydrocarbons ($/boe)
US 38.91 35.64 46.26
Europe 80.66 59.55 81.48
Rest of World 47.28 46.70 53.39
bp average 45.26 42.79 52.28
Average oil marker prices ($/bbl)
Brent 81.13 63.73 75.73
West Texas Intermediate 72.73 59.24 71.47
Western Canadian Select 57.22 46.72 58.29
Alaska North Slope 77.55 64.02 75.83
Average natural gas marker prices
Henry Hub gas price((b)) ($/mmBtu) 5.05 3.55 3.65
UK Gas - National Balancing Point (p/therm) 100.85 75.16 115.91
(a) Based on sales of consolidated subsidiaries only - this excludes
equity-accounted entities.
(b) Henry Hub First of Month Index.
Exchange rates
First Fourth First
quarter quarter quarter
2026 2025 2025
$/£ average rate for the period 1.35 1.33 1.26
$/£ period-end rate 1.32 1.35 1.29
$/€ average rate for the period 1.17 1.16 1.05
$/€ period-end rate 1.15 1.18 1.08
$/AUD average rate for the period 0.69 0.66 0.63
$/AUD period-end rate 0.68 0.67 0.63
Top of page 30
Legal proceedings
For a full discussion of the group's material legal proceedings, see pages
236-237 of bp Annual Report and Form 20-F 2025.
Glossary
Non-IFRS measures are provided for investors because they are closely tracked
by management to evaluate bp's operating performance and to make financial,
strategic and operating decisions. Non-IFRS measures are sometimes referred to
as alternative performance measures.
Adjusted EBITDA is a non-IFRS measure presented for bp's operating segments
and is defined as replacement cost (RC) profit before interest and tax,
adjusting for net adjusting items* before interest and tax, and adding back
depreciation, depletion and amortization and exploration write-offs (net of
adjusting items). Adjusted EBITDA by business is a further analysis of
adjusted EBITDA for the customers & products businesses. bp believes it is
helpful to disclose adjusted EBITDA by operating segment and by business
because it reflects how the segments measure underlying business delivery. The
nearest equivalent measure on an IFRS basis for the segment is RC profit or
loss before interest and tax, which is bp's measure of profit or loss that is
required to be disclosed for each operating segment under IFRS. A
reconciliation to IFRS information is provided on page 28 for the customers
& products businesses.
Adjusted operating expenditure is a non-IFRS measure and a subset of
production and manufacturing expenses plus distribution and administration
expenses. It represents the majority of the remaining expenses in these line
items but excludes certain costs that are variable, primarily with volumes
(such as freight costs). Other variable costs are included in purchases in the
income statement. Management believes that adjusted operating expenditure is a
performance measure that provides investors with useful information regarding
the company's financial performance because it considers these expenses to be
the principal operating and overhead expenses that are most directly under
their control although they also include certain adjusting items*, foreign
exchange and commodity price effects. The nearest IFRS measures are production
and manufacturing expenses and distributions and administration expenses. A
reconciliation of production and manufacturing expenses plus distribution and
administration expenses to adjusted operating expenditure is provided on page
27.
Adjusting items are items that bp discloses separately because it considers
such disclosures to be meaningful and relevant to investors. They are items
that management considers to be important to period-on-period analysis of the
group's results and are disclosed in order to enable investors to better
understand and evaluate the group's reported financial performance. Adjusting
items include gains and losses on the sale of businesses and fixed assets,
impairments, environmental and related provisions and charges, restructuring,
integration and rationalization costs, fair value accounting effects and costs
relating to the Gulf of America oil spill and other items. Adjusting items
within equity-accounted earnings are reported net of incremental income tax
reported by the equity-accounted entity. Adjusting items are used as a
reconciling adjustment to derive underlying RC profit or loss and related
underlying measures which are non-IFRS measures. An analysis of adjusting
items by segment and type is shown on page 25.
Capital expenditure is total cash capital expenditure as stated in the
condensed group cash flow statement. Capital expenditure for the operating
segments, gas & low carbon energy businesses and customers & products
businesses is presented on the same basis.
Consolidation adjustment - UPII is unrealized profit in inventory arising on
inter-segment transactions.
Divestment proceeds are disposal proceeds as per the condensed group cash flow
statement.
Excess cash is a non-IFRS measure and refers to the net of sources and uses of
cash. Sources of cash include net cash provided by operating activities, cash
provided from investing activities and cash receipts relating to transactions
involving non-controlling interests. Uses of cash include lease liability
payments, payments on perpetual hybrid bonds, dividends paid, cash capital
expenditure, the cash cost of share buybacks to offset the dilution from
vesting of awards under employee share schemes, cash payments relating to
transactions involving non-controlling interests and currency translation
differences relating to cash and cash equivalents as presented on the
condensed group cash flow statement.
Top of page 31
Glossary (continued)
Fair value accounting effects are non-IFRS adjustments to our IFRS profit
(loss). They reflect the difference between the way bp manages the economic
exposure and internally measures performance of certain activities and the way
those activities are measured under IFRS. Fair value accounting effects are
included within adjusting items. They relate to certain of the group's
commodity, interest rate and currency risk exposures as detailed below. Other
than as noted below, the fair value accounting effects described are reported
in both the gas & low carbon energy and customer & products segments.
bp uses derivative instruments to manage the economic exposure relating to
inventories above normal operating requirements of crude oil, natural gas and
petroleum products. Under IFRS, these inventories are recorded at historical
cost. The related derivative instruments, however, are required to be recorded
at fair value with gains and losses recognized in the income statement. This
is because hedge accounting is either not permitted or not followed,
principally due to the impracticality of effectiveness-testing requirements.
Therefore, measurement differences in relation to recognition of gains and
losses occur. Gains and losses on these inventories, other than net realizable
value provisions, are not recognized until the commodity is sold in a
subsequent accounting period. Gains and losses on the related derivative
commodity contracts are recognized in the income statement, from the time the
derivative commodity contract is entered into, on a fair value basis using
forward prices consistent with the contract maturity.
bp enters into physical commodity contracts to meet certain business
requirements, such as the purchase of crude for a refinery or the sale of bp's
gas production. Under IFRS these physical contracts are treated as derivatives
and are required to be fair valued when they are managed as part of a larger
portfolio of similar transactions. Gains and losses arising are recognized in
the income statement from the time the derivative commodity contract is
entered into.
IFRS require that inventory held for trading is recorded at its fair value
using period-end spot prices, whereas any related derivative commodity
instruments are required to be recorded at values based on forward prices
consistent with the contract maturity. Depending on market conditions, these
forward prices can be either higher or lower than spot prices, resulting in
measurement differences.
bp enters into contracts for pipelines and other transportation, storage
capacity, oil and gas processing, liquefied natural gas (LNG) and certain gas
and power contracts that, under IFRS, are recorded on an accruals basis. These
contracts are risk-managed using a variety of derivative instruments that are
fair valued under IFRS. This results in measurement differences in relation to
recognition of gains and losses.
The way that bp manages the economic exposures described above, and measures
performance internally, differs from the way these activities are measured
under IFRS. bp calculates this difference for consolidated entities by
comparing the IFRS result with management's internal measure of performance.
We believe that disclosing management's estimate of this difference provides
useful information for investors because it enables investors to see the
economic effect of these activities as a whole.
These include:
• Under management's internal measure of performance the
inventory, transportation and capacity contracts in question are valued based
on fair value using relevant forward prices prevailing at the end of the
period.
• Fair value accounting effects also include changes in the fair
value of the near-term portions of LNG contracts that fall within bp's risk
management framework. LNG contracts are not considered derivatives, because
there is insufficient market liquidity, and they are therefore accrual
accounted under IFRS. However, oil and natural gas derivative financial
instruments used to risk manage the near-term portions of the LNG contracts
are fair valued under IFRS. The fair value accounting effect, which is
reported in the gas and low carbon energy segment, represents the change in
value of LNG contracts that are being risk managed and which is reflected in
the underlying result, but not in reported earnings. Management believes that
this gives a better representation of performance in each period.
Furthermore, the fair values of derivative instruments used to risk manage
certain other oil, gas, power and other contracts, are deferred to match with
the underlying exposure. The commodity contracts for business requirements are
accounted for on an accruals basis.
In addition, fair value accounting effects include changes in the fair value
of derivatives entered into by the group to manage currency exposure and
interest rate risks relating to hybrid bonds to their respective first call
periods. The hybrid bonds which are classified as equity instruments were
recorded in the balance sheet at their issuance date at their USD equivalent
issued value. Under IFRS these equity instruments are not remeasured from
period to period, and do not qualify for application of hedge accounting. The
derivative instruments relating to the hybrid bonds, however, are required to
be recorded at fair value with mark to market gains and losses recognized in
the income statement. Therefore, measurement differences in relation to the
recognition of gains and losses occur. The fair value accounting effect, which
is reported in the other businesses & corporate segment, eliminates the
fair value gains and losses of these derivative financial instruments that are
recognized in the income statement. We believe that this gives a better
representation of performance, by more appropriately reflecting the economic
effect of these risk management activities, in each period.
Top of page 32
Glossary (continued)
Gas & low carbon energy segment comprises our gas and low carbon
businesses. Our gas business includes regions with upstream activities that
predominantly produce natural gas, gas trading and our Archaea Energy
business. Our low carbon business includes solar, offshore wind, hydrogen and
CCS, and power trading, and until December 2025 also included onshore wind.
Power trading and marketing includes trading of both renewable and
non-renewable power.
Gearing and gearing including leases are non-IFRS measures. See Net debt or
net debt including leases below.
Hydrocarbons - Liquids and natural gas. Natural gas is converted to oil
equivalent at 5.8 billion cubic feet = 1 million barrels.
Inorganic capital expenditure is a subset of capital expenditure on a cash
basis and a non-IFRS measure. Inorganic capital expenditure comprises
consideration in business combinations and certain other significant
investments made by the group. It is reported on a cash basis. bp believes
that this measure provides useful information as it allows investors to
understand how bp's management invests funds in projects which expand the
group's activities through acquisition. The nearest equivalent measure on an
IFRS basis is capital expenditure on a cash basis. Further information and a
reconciliation to IFRS information is provided on page 24.
Inventory holding gains and losses are non-IFRS adjustments to our IFRS profit
(loss) and represent:
• the difference between the cost of sales calculated using the
replacement cost of inventory and the cost of sales calculated on the first-in
first-out (FIFO) method after adjusting for any changes in provisions where
the net realizable value of the inventory is lower than its cost. Under the
FIFO method, which we use for IFRS reporting of inventories other than for
trading inventories, the cost of inventory charged to the income statement is
based on its historical cost of purchase or manufacture, rather than its
replacement cost. In volatile energy markets, this can have a significant
distorting effect on reported income. The amounts disclosed as inventory
holding gains and losses represent the difference between the charge to the
income statement for inventory on a FIFO basis (after adjusting for any
related movements in net realizable value provisions) and the charge that
would have arisen based on the replacement cost of inventory. For this
purpose, the replacement cost of inventory is calculated using data from each
operation's production and manufacturing system, either on a monthly basis, or
separately for each transaction where the system allows this approach; and
• an adjustment relating to certain trading inventories that are
not price risk managed which relate to a minimum inventory volume that is
required to be held to maintain underlying business activities. This
adjustment represents the movement in fair value of the inventories due to
prices, on a grade by grade basis, during the period. This is calculated from
each operation's inventory management system on a monthly basis using the
discrete monthly movement in market prices for these inventories.
The amounts disclosed are not separately reflected in the financial statements
as a gain or loss. No adjustment is made in respect of the cost of inventories
held as part of a trading position and certain other temporary inventory
positions that are price risk-managed. See Replacement cost (RC) profit or
loss definition below.
Liquids - Liquids comprises crude oil, condensate and natural gas liquids. For
the oil production & operations segment, it also includes bitumen.
Major projects have a bp net investment of at least $250 million, or are
considered to be of strategic importance to bp or of a high degree of
complexity.
Net debt and gearing are non-IFRS measures. Net debt is calculated as finance
debt, as shown in the balance sheet, plus the fair value of associated
derivative financial instruments that are used to hedge foreign currency
exchange and interest rate risks relating to finance debt, for which hedge
accounting is applied, less cash and cash equivalents. Net debt does not
include accrued interest, which is reported within other receivables and other
payables on the balance sheet and for which the associated cash flows are
presented as operating cash flows in the group cash flow statement. Gearing is
defined as the ratio of net debt to the total of net debt plus total equity.
bp believes these measures provide useful information to investors. Net debt
enables investors to see the economic effect of finance debt, related hedges
and cash and cash equivalents in total. Gearing enables investors to see how
significant net debt is relative to total equity. The derivatives are reported
on the balance sheet within the headings 'Derivative financial instruments'.
The nearest equivalent measures on an IFRS basis are finance debt and finance
debt ratio. A reconciliation of finance debt to net debt is provided on page
23.
We are unable to present reconciliations of forward-looking information for
net debt or gearing to finance debt and total equity, because without
unreasonable efforts, we are unable to forecast accurately certain adjusting
items required to present a meaningful comparable IFRS forward-looking
financial measure. These items include fair value asset (liability) of hedges
related to finance debt and cash and cash equivalents, that are difficult to
predict in advance in order to include in an IFRS estimate.
Net debt including leases and gearing including leases are non-IFRS measures.
Net debt including leases is calculated as net debt plus lease liabilities,
less the net amount of partner receivables and payables relating to leases
entered into on behalf of joint operations. Gearing including leases is
defined as the ratio of net debt including leases to the total of net debt
including leases plus total equity. bp believes these measures provide useful
information to investors as they enable investors to understand the impact of
the group's lease portfolio on net debt and gearing. The nearest equivalent
measures on an IFRS basis are finance debt and finance debt ratio. A
reconciliation of finance debt to net debt including leases is provided on
page 26.
Top of page 33
Glossary (continued)
Operating cash flow is net cash provided by (used in) operating activities as
stated in the condensed group cash flow statement.
Organic capital expenditure is a non-IFRS measure. Organic capital expenditure
comprises capital expenditure on a cash basis less inorganic capital
expenditure. bp believes that this measure provides useful information as it
allows investors to understand how bp's management invests funds in developing
and maintaining the group's assets. The nearest equivalent measure on an IFRS
basis is capital expenditure on a cash basis and a reconciliation to IFRS
information is provided on page 24.
We are unable to present reconciliations of forward-looking information for
organic capital expenditure to total cash capital expenditure, because without
unreasonable efforts, we are unable to forecast accurately the adjusting item,
inorganic capital expenditure, that is difficult to predict in advance in
order to derive the nearest IFRS estimate.
Production-sharing agreement/contract (PSA/PSC) is an arrangement through
which an oil and gas company bears the risks and costs of exploration,
development and production. In return, if exploration is successful, the oil
company receives entitlement to variable physical volumes of hydrocarbons,
representing recovery of the costs incurred and a stipulated share of the
production remaining after such cost recovery.
Realizations are the result of dividing revenue generated from hydrocarbon
sales, excluding revenue generated from purchases made for resale and royalty
volumes, by revenue generating hydrocarbon production volumes. Revenue
generating hydrocarbon production reflects the bp share of production as
adjusted for any production which does not generate revenue. Adjustments may
include losses due to shrinkage, amounts consumed during processing, and
contractual or regulatory host committed volumes such as royalties. For the
gas & low carbon energy and oil production & operations segments,
realizations include transfers between businesses.
Refining availability represents Solomon Associates' operational availability
for bp-operated refineries, which is defined as the percentage of the year
that a unit is available for processing after subtracting the annualized time
lost due to turnaround activity and all mechanical, process and regulatory
downtime.
Refining indicator margin (RIM) is a simple indicator of the weighted average
of bp's crude slate and product yield as deemed representative for each
refinery. Actual margins realized by bp may vary due to a variety of factors,
including the actual mix of a crude and product for a given quarter.
Replacement cost (RC) profit or loss / RC profit or loss attributable to bp
shareholders reflects the replacement cost of inventories sold in the period
and is calculated as profit or loss attributable to bp shareholders, adjusting
for inventory holding gains and losses (net of tax). RC profit or loss for the
group is not a recognized IFRS measure. bp believes this measure is useful to
illustrate to investors the fact that crude oil and product prices can vary
significantly from period to period and that the impact on our reported result
under IFRS can be significant. Inventory holding gains and losses vary from
period to period due to changes in prices as well as changes in underlying
inventory levels. In order for investors to understand the operating
performance of the group excluding the impact of price changes on the
replacement of inventories, and to make comparisons of operating performance
between reporting periods, bp's management believes it is helpful to disclose
this measure. The nearest equivalent measure on an IFRS basis is profit or
loss attributable to bp shareholders. A reconciliation to IFRS information is
provided on page 1. RC profit or loss before interest and tax is bp's measure
of profit or loss that is required to be disclosed for each operating segment
under IFRS.
Structural cost reduction is calculated as decreases in underlying operating
expenditure* (as defined on page 34) as a result of operational efficiencies,
divestments, workforce reductions and other cost saving measures that are
expected to be sustainable compared with 2023 levels. The total change between
periods in underlying operating expenditure will reflect both structural cost
reductions and other changes in spend, including market factors, such as
inflation and foreign exchange impacts, as well as changes in activity levels
and costs associated with new operations. Estimates of cumulative annual
structural cost reduction may be revised depending on whether cost reductions
realized in prior periods are determined to be sustainable compared with 2023
levels. Structural cost reductions are stewarded internally to support
management's oversight of spending over time.
bp believes this performance measure is useful in demonstrating how management
drives cost discipline across the entire organization, simplifying our
processes and portfolio and streamlining the way we work. The nearest IFRS
measures are production and manufacturing expenses and distributions and
administration expenses. A reconciliation of production and manufacturing
expenses plus distribution and administration expenses to underlying operating
expenditure is provided on page 27.
Top of page 34
Glossary (continued)
Technical service contract (TSC) - Technical service contract is an
arrangement through which an oil and gas company bears the risks and costs of
exploration, development and production. In return, the oil and gas company
receives entitlement to variable physical volumes of hydrocarbons,
representing recovery of the costs incurred and a profit margin which reflects
incremental production added to the oilfield.
Tier 1 and tier 2 process safety events - Tier 1 events are losses of primary
containment from a process of greatest consequence - causing harm to a member
of the workforce, damage to equipment from a fire or explosion, a community
impact or exceeding defined quantities. Tier 2 events are those of lesser
consequence. These represent reported incidents occurring within bp's
operational HSSE reporting boundary. That boundary includes bp's own operated
facilities and certain other locations or situations. Reported process safety
events are investigated throughout the year and as a result there may be
changes in previously reported events. Therefore comparative movements are
calculated against internal data reflecting the final outcomes of such
investigations, rather than the previously reported comparative period, as
this represents a more up to date reflection of the safety environment.
Underlying effective tax rate (ETR) is a non-IFRS measure. The underlying ETR
is calculated by dividing taxation on an underlying replacement cost (RC)
basis by underlying RC profit or loss before tax. Taxation on an underlying RC
basis for the group is calculated as taxation as stated on the group income
statement adjusted for taxation on inventory holding gains and losses and
total taxation on adjusting items. Information on underlying RC profit or loss
is provided below. Taxation on an underlying RC basis presented for the
operating segments is calculated through an allocation of taxation on an
underlying RC basis to each segment. bp believes it is helpful to disclose the
underlying ETR because this measure may help investors to understand and
evaluate, in the same manner as management, the underlying trends in bp's
operational performance on a comparable basis, period on period. Taxation on
an underlying RC basis and underlying ETR are non-IFRS measures. The nearest
equivalent measure on an IFRS basis is the ETR on profit or loss for the
period.
We are unable to present reconciliations of forward-looking information for
underlying ETR to ETR on profit or loss for the period, because without
unreasonable efforts, we are unable to forecast accurately certain adjusting
items required to present a meaningful comparable IFRS forward-looking
financial measure. These items include the taxation on inventory holding gains
and losses and adjusting items, that are difficult to predict in advance in
order to include in an IFRS estimate.
Underlying operating expenditure is a non-IFRS measure and a subset of
production and manufacturing expenses plus distribution and administration
expenses and excludes costs that are classified as adjusting items. It
represents the majority of the remaining expenses in these line items but
excludes certain costs that are variable, primarily with volumes (such as
freight costs). Other variable costs are included in purchases in the income
statement. Management believes that underlying operating expenditure is a
performance measure that provides investors with useful information regarding
the company's financial performance because it considers these expenses to be
the principal operating and overhead expenses that are most directly under
their control although they also include certain foreign exchange and
commodity price effects. The nearest IFRS measures are production and
manufacturing expenses and distribution and administration expenses. A
reconciliation of production and manufacturing expenses plus distribution and
administration expenses to underlying operating expenditure is provided on
page 27.
Underlying production - 2026 underlying production, when compared with 2025,
is production after adjusting for acquisitions and divestments, curtailments,
and entitlement impacts in our production-sharing agreements/contracts and
technical service contract.
Underlying RC profit or loss / underlying RC profit or loss attributable to bp
shareholders is a non-IFRS measure and is RC profit or loss* (as defined on
page 33) after excluding net adjusting items and related taxation. See page 25
for additional information on the adjusting items that are used to arrive at
underlying RC profit or loss in order to enable a full understanding of the
items and their financial impact.
Underlying RC profit or loss before interest and tax for the operating
segments or customers & products businesses is calculated as RC profit or
loss (as defined above) including profit or loss attributable to
non-controlling interests before interest and tax for the operating segments
and excluding net adjusting items for the respective operating segment or
business.
bp believes that underlying RC profit or loss is a useful measure for
investors because it is a measure closely tracked by management to evaluate
bp's operating performance and to make financial, strategic and operating
decisions and because it may help investors to understand and evaluate, in the
same manner as management, the underlying trends in bp's operational
performance on a comparable basis, period on period, by adjusting for the
effects of these adjusting items. The nearest equivalent measure on an IFRS
basis for the group is profit or loss attributable to bp shareholders. The
nearest equivalent measure on an IFRS basis for segments and businesses is RC
profit or loss before interest and taxation. A reconciliation to IFRS
information is provided on page 1 for the group and pages 6-12 for the
segments.
Top of page 35
Glossary (continued)
Underlying RC profit or loss per share / underlying RC profit or loss per ADS
is a non-IFRS measure. Earnings per share is defined in Note 7. Underlying RC
profit or loss per ordinary share is calculated using the same denominator as
earnings per share as defined in the consolidated financial statements. The
numerator used is underlying RC profit or loss attributable to bp
shareholders, rather than profit or loss attributable to bp ordinary
shareholders. Underlying RC profit or loss per ADS is calculated as outlined
above for underlying RC profit or loss per share except the denominator is
adjusted to reflect one ADS equivalent to six ordinary shares. bp believes it
is helpful to disclose the underlying RC profit or loss per ordinary share and
per ADS because these measures may help investors to understand and evaluate,
in the same manner as management, the underlying trends in bp's operational
performance on a comparable basis, period on period. The nearest equivalent
measure on an IFRS basis is basic earnings per share based on profit or loss
for the period attributable to bp ordinary shareholders.
upstream includes oil and natural gas field development and production within
the gas & low carbon energy and oil production & operations segments.
upstream/hydrocarbon plant reliability (bp-operated) is calculated taking 100%
less the ratio of total unplanned plant deferrals divided by installed
production capacity, excluding non-operated assets and bpx energy. Unplanned
plant deferrals are associated with the topside plant and where applicable the
subsea equipment (excluding wells and reservoir). Unplanned plant deferrals
include breakdowns, which does not include Gulf of America weather related
downtime.
upstream unit production costs are calculated as production cost divided by
units of production. Production cost does not include ad valorem and severance
taxes. Units of production are barrels for liquids and thousands of cubic feet
for gas. Amounts disclosed are for bp subsidiaries only and do not include
bp's share of equity-accounted entities.
Working capital is movements in inventories and other current and non-current
assets and liabilities as reported in the condensed group cash flow statement.
Change in working capital adjusted for inventory holding gains/losses, fair
value accounting effects relating to subsidiaries and other adjusting items is
a non-IFRS measure. It is calculated by adjusting for inventory holding
gains/losses reported in the period; fair value accounting effects relating to
subsidiaries reported within adjusting items for the period; and other
adjusting items relating to the non-cash movement of US emissions obligations
carried as a provision that will be settled by allowances held as inventory.
This represents what would have been reported as movements in inventories and
other current and non-current assets and liabilities, if the starting point in
determining net cash provided by operating activities had been underlying
replacement cost profit rather than profit for the period. The nearest
equivalent measure on an IFRS basis for this is movements in inventories and
other current and non-current assets and liabilities.
bp utilizes various arrangements in order to manage its working capital
including discounting of receivables and, in the supply and trading business,
the active management of supplier payment terms, inventory and collateral.
Trade marks
Trade marks of the bp group appear throughout this announcement. They include:
bp, Amoco, Aral, ampm, bp pulse, Castrol, PETRO, TA, and Thorntons
Top of page 36
Cautionary statement
In order to utilize the 'safe harbor' provisions of the United States Private
Securities Litigation Reform Act of 1995 (the 'PSLRA') and the general
doctrine of cautionary statements, bp is providing the following cautionary
statement:
The discussion in this announcement contains certain forecasts, projections
and forward-looking statements - that is, statements related to future, not
past events and circumstances - with respect to the financial condition,
results of operations and businesses of bp and certain of the plans and
objectives of bp with respect to these items. These statements may generally,
but not always, be identified by the use of words such as 'will', 'expects',
'is expected to', 'aims', 'should', 'may', 'objective', 'is likely to',
'intends', 'believes', 'anticipates', 'plans', 'we see', 'focus on' or similar
expressions.
In particular, the following, among other statements, are all forward-looking
in nature: plans, expectations and assumptions regarding oil and gas demand,
supply, prices or volatility; expectations regarding production and volumes;
expectations regarding turnaround and maintenance activity; plans and
expectations regarding bp's balance sheet, financial performance, results of
operations, cost reduction, cash flows, and shareholder returns; plans and
expectations regarding the amount and timing of dividends, share buybacks,
dividend reinvestment programs and the use of excess cash; plans and
expectations regarding bp's upstream production; plans and expectations
regarding the amount, effects, timing, quantum and nature of certain
acquisitions, divestments and related payments and proceeds, including
expectations regarding the Castrol business, the Gelsenkirchen refinery, the
offshore exploration blocks in Namibia, Lightsource bp and other bp businesses
and assets subject to disposal or divestment; plans and expectations regarding
bp's net debt, credit rating, hybrid capital (including with respect to the
redemption, without replacement, of hybrid bonds), investment strategy,
capital expenditures, capital frame, underlying effective tax rate, and
depreciation, depletion and amortization; expectations regarding bp's
customers business, including with respect to volumes, earnings growth, fuels
margins, the impact of underlying operating expenditure, structural cost
reduction and the earnings impact of divestments; expectations regarding bp's
products, including underlying performance, industry refining margins,
refinery turnaround activity, and refining margins and operations at the
Whiting refinery; expectations regarding bp's other businesses & corporate
underlying annual charge; and expectations regarding Gulf of America
settlement payments.
By their nature, forward-looking statements involve risk and uncertainty
because they relate to events and depend on circumstances that will or may
occur in the future and are outside the control of bp. Recent global
developments have caused significant uncertainty and volatility in
macroeconomic conditions and commodity markets. Each item of outlook and
guidance set out in this announcement is based on bp's current expectations
but actual outcomes and results may be impacted by these evolving
macroeconomic and market conditions.
Actual results or outcomes may differ materially from those expressed in such
statements, depending on a variety of factors, including: the extent and
duration of the impact of current market conditions including the volatility
of oil prices, the effects of bp's plan to exit its shareholding in Rosneft
and other investments in Russia, overall global economic and business
conditions impacting bp's business and demand for bp's products as well as the
specific factors identified in the discussions accompanying such
forward-looking statements; changes in consumer preferences and societal
expectations; the pace of development and adoption of alternative energy
solutions; developments in policy, law, regulation, technology and markets,
including societal and investor sentiment related to the issue of climate
change; the receipt of relevant third party and/or regulatory approvals
including ongoing approvals required for the continued developments of
approved projects; the timing and level of maintenance and/or turnaround
activity; the timing and volume of refinery additions and outages; the timing
of bringing new fields onstream; the timing, quantum and nature of certain
acquisitions and divestments; future levels of industry product supply, demand
and pricing, including supply growth in North America and continued base oil
and additive supply shortages; OPEC+ quota restrictions; PSA and TSC effects;
operational and safety problems; potential lapses in product quality; economic
and financial market conditions generally or in various countries and regions;
political stability and economic growth in relevant areas of the world;
changes in laws and governmental regulations and policies, including related
to climate change; changes in social attitudes and customer preferences;
regulatory or legal actions including the types of enforcement action pursued
and the nature of remedies sought or imposed; the actions of prosecutors,
regulatory authorities and courts; delays in the processes for resolving
claims; amounts ultimately payable and timing of payments relating to the Gulf
of America oil spill; the conditions and developments in the Middle East;
exchange rate fluctuations; development and use of new technology; recruitment
and retention of a skilled workforce; the success or otherwise of partnering;
the actions of competitors, trading partners, contractors, subcontractors,
creditors, rating agencies and others; bp's access to future credit resources;
business disruption and crisis management; the impact on bp's reputation of
ethical misconduct and non-compliance with regulatory obligations; trading
losses; major uninsured losses; the possibility that international sanctions
or other steps taken by governmental authorities or any other relevant persons
may impact bp's ability to sell its interests in Rosneft, or the price for
which bp could sell such interests; the actions of contractors; natural
disasters and adverse weather conditions; changes in public expectations and
other changes to business conditions; wars and acts of terrorism;
cyber-attacks or sabotage; and those factors discussed under "Risk factors" in
bp's Annual Report and Form 20-F for fiscal year 2025 as filed with the US
Securities and Exchange Commission.
Cautionary note to U.S. investors - This document contains references to
non-proved reserves and production outlooks based on non-proved reserves that
the SEC's rules prohibit us from including in our filings with the SEC. U.S.
investors are urged to consider closely the disclosures in our Form 20-F, SEC
File No. 1-06262. This form is available on our website at www.bp.com. You can
also obtain this form from the SEC's website at www.sec.gov.
Top of page 37
Contacts
London Houston
Press Office Rita Brown Paul Takahashi
+44 (0) 7787 685821 +1 713 903 9729
Investor Relations Craig Marshall Graham Collins
bp.com/investors +44 (0) 203 401 5592 +1 832 753 5116
BP p.l.c.'s LEI Code 213800LH1BZH3DI6G760
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