BP shares rose on Tuesday after the oil major reported higher profits driven by rising oil prices towards the end of the first quarter.
BP’s Underlying replacement cost profit more than doubled to $3.2bn from $1.4bn in the same period last year, as the new CEO took the reins during a period punctuated by soaring oil prices.
“The highest quarterly profit in the best part of three years is not a bad way for new BP CEO Meg O’Neill to begin her tenure. Circumstances have helped but, as Napoleon famously attested, there’s no harm in being a lucky general,” said Dan Coatsworth, head of markets at AJ Bell.
BP had been struggling with lower profits going into 2026, and the tick higher in profits will be welcomed by the market, which was quick to price in better performance as the Middle East war started. BP shares were 3% higher on Tuesday, taking the year-to-date performance to 36%.
BP’s trading division was the big winner from the higher oil price, helping lift group earnings as the oil firm contended with disruptions to Middle East oil activities.
Mark Crouch, market analyst for eToro, said: “BP’s first-quarter earnings offer a timely reminder of just how abruptly the pendulum can swing in the energy sector.”
“Underlying profits jumped to $3.2 billion, boosted by a powerful mix of elevated prices and exceptional trading conditions, even as disruptions in the Middle East weighed modestly on operations. In many respects, BP has both absorbed and benefited from the same geopolitical tensions, with volatility once again proving a tailwind for an integrated major.”
Income investors may be a little disappointed to see the quarterly dividend held at 8.32 cents, but this may reflect the possible transitory nature of the profit improvement. Should oil prices fall back, it’s likely that profits would follow suit.