Fourth quarter and full year 2025 results

Highlights 

4Q25 underlying replacement cost (RC) profit* $1.5 billion

• Underlying RC profit for the quarter of $1.5 billion, compared with $2.2 billion for the previous quarter. Compared with the third quarter 2025, the underlying result reflects lower upstream realizations, adverse impact of upstream production mix, lower refinery throughputs due to higher turnaround activity and the temporary impact of reduced capacity following an outage at the Whiting refinery and seasonally lower customer volumes, partly offset by lower exploration write-offs. The underlying effective tax rate (ETR)* in the quarter was 43%, compared with 39% for the previous quarter, which reflects changes in the geographical mix of profits.
• Reported loss for the quarter was $3.4 billion, compared with a profit of $1.2 billion for the third quarter 2025. The reported result for the fourth quarter is adjusted for inventory holding loss* of $0.7 billion (net of tax) and a net adverse impact of adjusting items* of $4.3 billion (net of tax) to derive the underlying RC profit. Adjusting items include post-tax net impairments and impairments in equity-accounted entities of around $4 billion, primarily related to our transition businesses in the gas & low carbon energy segment (see Note 3 and page 25 for more information on adjusting items).

Segment results

• Gas & low carbon energy: The RC loss before interest and tax for the fourth quarter 2025 was $2.2 billion, compared with a profit of $1.1 billion for the previous quarter. After adjusting RC loss before interest and tax for a net adverse impact of adjusting items of $3.6 billion as discussed above, the underlying RC profit before interest and tax* for the fourth quarter was $1.4 billion, compared with $1.5 billion in the third quarter 2025. The fourth quarter underlying result before interest and tax reflects lower realizations. The gas marketing and trading result was average.
• Oil production & operations: The RC profit before interest and tax for the fourth quarter 2025 was $1.7 billion, compared with $2.1 billion for the previous quarter. After adjusting RC profit before interest and tax for a net adverse impact of adjusting items of $0.2 billion, the underlying RC profit before interest and tax for the fourth quarter was $2.0 billion, compared with $2.3 billion in the third quarter 2025. The fourth quarter underlying result before interest and tax reflects lower realizations, the impact of production mix, and a lower share of net income of equity-accounted entities, partly offset by lower exploration write-offs.
• Customers & products: The RC profit before interest and tax for the fourth quarter 2025 was $1.4 billion, compared with $1.6 billion for the previous quarter. After adjusting RC profit before interest and tax for a net favourable impact of adjusting items of $0.1 billion, the underlying RC profit before interest and tax (underlying result) for the fourth quarter was $1.3 billion, compared with $1.7 billion in the third quarter 2025. The customers fourth quarter underlying result was lower by $0.3 billion, reflecting seasonally lower volumes and a weaker midstream performance. Fuels margins were broadly flat compared with the third quarter. The products fourth quarter underlying result was lower by $0.1 billion. Stronger realized refining margins were offset by the impacts of lower throughputs as a result of higher turnaround activity and the temporary impact of reduced capacity following an outage at the Whiting refinery. The oil trading contribution was weak.

Operating cash flow* $7.6 billion and net debt* $22.2 billion

• Operating cash flow for the quarter of $7.6 billion includes a $0.9 billion working capital* release (after adjusting inventory holding losses, fair value accounting effects and other adjusting items) and was around $0.2 billion lower than the previous quarter reflecting lower underlying earnings partly offset by lower cash taxes paid. Net debt reduced to $22.2 billion in the fourth quarter primarily driven by the impact of proceeds from divestments of around $3.6 billion partly offset by the $0.6 billion deferred payment for the bp Bunge Bioenergia acquisition. 

Our financial frame - accelerating the pace of strengthening the balance sheet

• 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 fourth 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 obligations including hybrid bonds, leases and our Gulf of America settlement liabilities. The board has decided to suspend share buybacks, allocate excess cash* to strengthen the balance sheet and accordingly, the guidance for shareholder distributions to be around 30-40% of operating cash flow is now retired.
• Reflecting our continued emphasis on capital efficiency, discipline and returns, we have set our 2026 capital expenditure* budget in the range of $13-13.5 billion. We believe this level of capital expenditure supports progressively growing earnings per ordinary share in the long term.

(a) Shareholder distribution decisions, including dividends and share buybacks, are subject to board discretion, taking into account factors including, but not limited to, current forecasts and credit metrics. 

The commentary above contains forward-looking statements and should be read in conjunction with the cautionary statement on page 38.

Further information

Contacts

bp press office, London: +44 20 7496 4076, bppress@bp.com

Cautionary statement

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, Lightsource bp and other bp businesses and assets subject to disposal or divestment; plans and expectations regarding bp’s net debt, credit rating, 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 and the impact of structural cost reduction; expectations regarding bp’s products, including underlying performance, industry refining margins and refinery turnaround activity; expectations regarding bp’s other businesses & corporate underlying annual charge; expectations regarding Gulf of America settlement payments; plans and expectations regarding the Greater Western Flank 4 project, the Bumerangue block, the Atlantis Drill Center 1 expansion project; and expectations regarding bp’s tax liabilities and obligations, including the future impact of German tax legislation.

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; 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 “Principal risks and uncertainties” in bp’s Report on Form 6-K regarding results for the six-month period ended 30 June 2025 as filed with the US Securities and Exchange Commission (the “SEC”) as well as “Risk factors” in bp’s Annual Report and Form 20-F for fiscal year 2024 as filed with the SEC.

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.

This announcement contains inside information. The person responsible for arranging the release of this announcement on behalf of BP p.l.c. is Ben Mathews, Company Secretary.