Sparks - bp

bp (LSE: BP) expects Q226 underlying earnings to benefit from higher Brent prices and refining margins, partly offset by lower production and higher maintenance activity. Brent averaged $103.85/bbl versus $81.13/bbl in Q126, while bp’s refining indicator margin increased to $29.6/bbl from $16.9/bbl; Henry Hub declined to $2.90/mmBtu from $5.05/mmBtu. Upstream production is guided to 2,170–2,220mboe/d versus 2,339mboe/d in Q126, comprising oil production and operations of 1,420–1,450mboe/d versus 1,541mboe/d and gas and low carbon energy production of 750–770mboe/d versus 798mboe/d. Relative to Q126, realizations are expected to benefit underlying RC profit before interest and tax by $0.5–0.7bn in gas and low carbon energy and $1.8–2.1bn in oil production and operations. Stronger realized refining margins are expected to contribute a further $1.2–1.4bn, although throughput is guided to 1,445–1,475mb/d versus 1,527mb/d.

bp’s underlying effective tax rate is expected to increase to 33–37% from 32% in Q126. Net debt is guided to $22–23bn versus $25.3bn at Q126, after a $2.9bn payment to redeem €2.5bn of hybrid bonds and a $1.1bn Gulf of America settlement payment; remaining hybrid bonds are expected to decline to c $13bn from $16.0bn. Working capital is expected to build by $0–1.5bn versus a $6.0bn build in Q126, while net debt, hybrids and Gulf of America settlement liabilities combined are expected to decline by $6.3–7.3bn quarter-on-quarter. Q226 results are also expected to include c $0.5bn of exploration write-offs, primarily related to Bay du Nord, and c $1.0bn of post-tax impairments, mainly relating to transition businesses. bp will report Q226 results on 4 August 2026.