BP p.l.c.

BP reported first-quarter underlying net income of $3.2 billion, operating cash flow of $8.9 billion before a $6 billion working capital build, and production of 2.3 million barrels of oil equivalent per day. Refining availability was above the 96% target and throughput was over 1.5 million barrels per day, the highest quarterly figure in 4 years. Management did not give next-quarter earnings guidance, but reiterated confidence in delivering its net debt target, said the Castrol transaction is expected to close toward the back end of 2026, and reaffirmed a capital frame of $13 billion to $15 billion for the next 2 years, tightened further to $13 billion to $13.5 billion this year. BP also said it expects to reduce its corporate hybrid stack by over $4 billion by the end of 2027.

Meg O’Neill framed the quarter as strong despite external volatility, pointing to reliable operations, higher Gulf of America production, strong BPX performance, and record quarterly throughput in 4 years. Strategically, she emphasized simplifying BP into an upstream/downstream model, improving accountability and decision-making, and concentrating on balance-sheet strength so the company can invest in growth through the cycle. Her tone was upbeat but disciplined, repeatedly stressing safe, reliable operations, capital discipline, and a focus on delivery.

Kate Thomson said the board paused buybacks in February to accelerate balance-sheet repair and delivery of the net debt target. She said the $4 billion hybrid reduction is focused on the two tranches that come due in 2026 and 2027, and that hybrids remain a permanent part of the capital structure, with early retirement potentially uneconomic depending on market conditions. She also said structural cost reductions have now delivered another $300 million, putting BP at 70% delivered against the original 4% to 5% target, and reiterated a tight capital frame of $13 billion to $15 billion for the next 2 years, tightened to $13 billion to $13.5 billion this year.

Analysts pressed management on the upstream/downstream reorganization, the ideal capital structure, and whether BP could go beyond the announced hybrid reduction. Management said the reorganization is meant to simplify operations and sharpen accountability, while capital decisions will be economically driven and tied to strengthening the balance sheet. Questions also focused on trading, LNG optionality, and the Middle East; Carol Howle said trading exists primarily to support BP’s assets rather than become a standalone trading company, and she described LNG as a diversified, growing portfolio that can be reoptimized to meet customer demand. On Iraq and the Strait of Hormuz, BP said it stands ready to help, but operational questions are best directed to the field operator.