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.
Financial summary
$ million | First quarter 2026 | Fourth quarter 2025 | First quarter 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 |
(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 24.
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 29. Non-IFRS measures are marked with an asterisk.
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 24 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.
“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."
bp press office, London: +44 20 7496 4076, bppress@bp.com
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.