BP p.l.c.

Overview

BP p.l.c. is one of the world's oil and gas "supermajors," with operations spanning exploration, production, refining, trading, and a low-carbon energy business. Founded in 1909 as the Anglo-Persian Oil Company to develop oil concessions in what is now Iran, BP has gone through repeated strategic reinventions, from "Beyond Petroleum" in the early 2000s to a net-zero pivot in 2020 under CEO Bernard Looney, to a scaling back of those commitments from 2023 onward. The company is headquartered in London and listed on both the London Stock Exchange and the New York Stock Exchange.

Bernard Looney resigned as CEO in September 2023 after BP determined he had not been fully transparent with the board about past personal relationships with colleagues. Murray Auchincloss, previously CFO, became CEO in January 2024 and in February 2025 led a strategic reset that slowed the planned decline in oil and gas output, cut renewables spending, and refocused capital on higher-return hydrocarbons. Auchincloss stepped down in December 2025 after less than two years; the board appointed Meg O'Neill, then CEO of Woodside Energy, effective April 2026. BP described O'Neill as its first chief executive appointed from outside the company and the first woman to lead a top-five Western oil major.

BP's shares have underperformed several peers over the past five years, weighed by the 2020 dividend cut (its first since the 2010 Deepwater Horizon disaster), subsequent strategic shifts, and questions about execution. In April 2025 activist investor Elliott Investment Management disclosed a stake of about 5%, pressing for faster portfolio change and higher capital returns. Governance has also been unsettled at the top: chair Helge Lund announced his departure in April 2025; his successor Albert Manifold, the former CRH chief executive, took the chair in October 2025 but was removed in May 2026 over what the board called serious concerns about conduct and governance, with non-executive director Ian Tyler appointed interim chair.

Business segments

Financial performance

BP reported FY2025 underlying replacement cost (RC) profit, its preferred adjusted earnings metric, of about $7.5 billion, down from $8.9 billion in 2024, $13.8 billion in 2023, and $27.7 billion in 2022. The decline reflects lower commodity prices, weaker refining margins, and charges tied to renewable write-downs and portfolio restructuring. Net debt was $22.2 billion at year-end 2025, down from $23.0 billion a year earlier; BP targets net debt of $14–18 billion by the end of 2027 and guides 2026 capital expenditure to $13.0–13.5 billion.

The dividend is a sensitive topic for BP investors. In 2020 BP cut its dividend by 50%, its first cut since the Deepwater Horizon disaster, citing the cost of its transition strategy during a period of weak oil prices. It has since rebuilt the payout and raised the quarterly dividend to 8.320 cents per share in 2025. Alongside its FY2025 results, BP suspended share buybacks to prioritize reducing net debt, a shift from its prior policy of steady repurchases. BP employed about 93,700 people at the end of 2025.

Elliott Investment Management disclosed a stake of about 5% (5.006%) in April 2025 and pressed the board for faster asset sales, higher shareholder returns, and operational improvement. BP has said its February 2025 reset and subsequent divestments, including the Castrol sale, advance those aims. Separately, in June 2025 Shell stated under Rule 2.8 of the UK Takeover Code that it had no intention of making an offer for BP, ending speculation about a possible combination.

Strategy & outlook

Under the February 2025 reset, BP shifted toward what it calls "resilient hydrocarbons" alongside a more selective approach to renewables. It abandoned its 2020 plan to cut oil and gas output by about 40% by 2030, a target it had already trimmed to roughly 25% in 2023, and now plans to hold production at about 2.3 to 2.5 million barrels of oil equivalent a day through 2030 while raising oil and gas investment to around $10 billion a year. BP has set a divestment target of about $20 billion by 2027.

The Gulf of Mexico deepwater portfolio is central to BP's "advantaged" upstream: high-margin output from existing infrastructure, supplemented by the new Kaskida and Tiber-Guadalupe Paleogene developments. Azerbaijan's ACG provides long-cycle production under agreements that extend into the 2050s. BP has said its focus on these assets reflects a priority on capital discipline.

On low carbon, BP retains positions in bioenergy (including its Archaea Energy biogas business), EV charging, and hydrogen, while scaling back offshore wind through the JERA Nex bp joint venture. BP has positioned itself as a "transition" company rather than a pure hydrocarbon producer or a renewables developer. Generating competitive returns from that position is the central challenge for new CEO Meg O'Neill's tenure.

Key considerations

Activist and governance pressure adds uncertainty to BP's strategy. Elliott has pushed for more change than management had planned, and the board's turnover at the top within roughly a year (Lund's announced departure, Manifold's appointment and removal, and Auchincloss's exit) has drawn investor attention to governance. Analysts have noted the risk that external pressure pushes asset sales at unfavorable timing or valuations.

BP's balance sheet carries more leverage than its largest U.S. peers. Net debt of $22.2 billion sits above the company's longer-term target range, and at lower oil prices, cash flow coverage of the dividend and capital program tightens. Analysts have noted that a sustained period of $60–65 per barrel Brent would pressure BP more than ExxonMobil or Chevron, which carry lower leverage and lower break-even costs.

The Deepwater Horizon disaster, settled through more than $65 billion in cumulative charges over more than a decade, remains a reference point in discussions of BP's risk management. It also reduced BP's appetite for frontier deepwater exploration risk and contributed to a long period of asset sales. Rebuilding a consistent record of operational reliability remains a long-term task.

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