BP's Strong First-Quarter Performance Exceeds Analyst Expectations

BP reported first-quarter profits that comfortably surpassed analyst forecasts, with underlying replacement cost (RC) profit reaching $3.2 billion for the three months to March, significantly up from $1.38 billion a year earlier and ahead of the $2.67 billion consensus. The company's share price opened nearly 2% higher following the announcement.

Upstream and Operational Highlights

The supermajor's performance was supported by steady upstream delivery, with higher volumes in the US Gulf and continued strength at US shale arm bpx Energy offsetting disruption in the Middle East. Production remained broadly flat over the quarter, averaging 2.34 million barrels of oil equivalent per day, while BP-operated plant reliability improved to 95.7%. CEO Meg O'Neill highlighted high plant reliability and high refining availability as key factors.

Downstream and Trading Success

Downstream performance was lifted by "exceptional oil trading," higher realised refining margins, and improved midstream optimisation. Underlying RC profit before interest and tax for the division rose sharply to $2.45 billion from $103 million a year earlier. Improved refining availability, lower turnaround activity, and operational recovery at the Whiting refinery in the US contributed to higher throughput. Better crude selection, timing effects, and stronger supply optimisation were also cited as key contributors.

Gas and Low Carbon Business

BP's gas and low carbon business benefited from higher production, particularly from recent project start-ups in Egypt and liquefied natural gas operations, which helped cushion the impact of weaker realisations and price lag effects. Segment output increased nearly 6% year on year, with gas marketing and trading delivering an average contribution.

Future Outlook and Guidance

Looking ahead, BP warned that second-quarter upstream production is expected to be lower due to seasonal maintenance and ongoing Middle East disruption, while trading results are likely to normalise following the strong first quarter. The group reiterated its capital expenditure guidance for 2026 at between $13 and $13.5 billion and confirmed a quarterly dividend of 8.32 cents per share. RBC Capital Markets noted that refining and trading numbers were "well in excess of consensus," though upstream performance was described as "a tad disappointing."