British energy giant bp is tipped to deliver stronger second-quarter earnings due to strong oil and gas prices, despite weathering a dip in upstream production and a US$1 billion impairment hit.
bp flagged that realisations in its oil production and operations segment are expected to boost earnings by US$1.8 billion to US$2.1 billion compared to the first quarter.
Additionally, the company’s products division enjoyed stronger realised refining margins, expected to provide a positive impact of US$1.2 billion to US$1.4 billion.
These gains will be partially offset by a projected US$1 billion post-tax impairment charge, largely tied to transition businesses within its gas and low-carbon energy division.
bp also expects to record around US$500 million in exploration write-offs, mostly reflecting the sale of its Bay du Nord project in Canada.
The company expects its net debt to fall to between US$22 billion and US$23 billion, down from US$25.3 billion in the first quarter.
This substantial reduction comes despite the company making a hefty US$2.9 billion payment to redeem hybrid bonds and shelling out US$1.1 billion in Gulf of America settlement liabilities.
However, the group’s upstream production is projected to slide to between 2,170 and 2,220 thousand barrels of oil equivalent per day (mboe/d), down from 2,339 mboe/d in the previous quarter.
bp attributed the slump to seasonal maintenance, primarily in the Gulf of America, alongside ongoing operational disruptions in the Middle East.
Overall, the trading update paints a picture of a resilient financial performance, where successful debt reduction and robust refining margins have cushioned the blow of maintenance-driven production losses and portfolio write-downs.
bp’s group results for the second quarter 2026 are scheduled to be published on August 4.
