Galp delivered a solid start to 2026, with first-quarter earnings aligning with analyst expectations, driven by a sharp rise in Brazilian production and stronger oil prices that offset market volatility and weaker conditions in renewables. The Portuguese oil major reported net income of €272 million, slightly below the consensus forecast of €276 million, while group adjusted EBITDA surged 41% year-on-year to €943 million.

Upstream Performance

The upstream portfolio continued to underpin group results amid a volatile macroeconomic backdrop marked by the Middle East war. Upstream production increased 23% year-on-year to 129,000 barrels of oil equivalent per day, reflecting lower planned maintenance impact, strong output from mature Brazilian assets, and the continued ramp-up of the Bacalhau floating production, storage, and offloading vessel. The upstream division delivered a 78% increase in adjusted EBITDA in the quarter. Higher realised oil prices also supported results, with Galp benefiting from March’s crude rally when Brent averaged about $81 per barrel. Co-CEOs Maria Joao Carioca and Joao Marques da Silva noted strong operational execution despite heightened price volatility.

Downstream and Renewables

Downstream earnings were more mixed. Industrial and midstream EBITDA slipped 9% year-on-year as severe weather in Portugal disrupted refinery operations early in the quarter. While international refining margins strengthened sharply in March, particularly for middle distillates, results were dampened by accounting lag effects and inventory-related impacts linked to sharply rising commodity prices. Renewables remained under pressure, posting a €2 million loss, as higher generation volumes were outweighed by persistently weak solar prices in Iberia amid high renewable penetration.

Cash Flow and Financial Position

Cash generation remained robust, with €482 million in cash flow from operations and €47 million of free cash flow after capital expenditure focused on upstream developments and low-carbon projects at Sines. Net debt was unchanged at €1.3 billion, while Galp spent €46 million on its ongoing share buyback programme during the quarter.

Outlook and Strategic Developments

Looking ahead, Galp said preparations were advancing for its next exploration and appraisal campaign in Namibia. The company added it remains in discussions with Moeve regarding a possible combination of their downstream operations, with an agreement still expected by mid-year. RBC Capital Markets noted that upstream earnings came in well ahead of forecasts, supported by higher realised prices and the Bacalhau ramp-up. Galp has maintained its guidance for the year, with RBC observing that "the macro remains supportive" with rising refining margins.