BP expects $3B–$4.5B in Q3 2026 impairment charges
Expected quarter-end net debt is $13.5 to 14.5 billion, while post-tax adjusting impairment items are expected at $3.0 to 4.5 billion.
Sentiment and the balance of points
Rhea-AI Sentiment reads the wording of the document, how positive or negative its language is on a 1 to 5 scale. The balance of points shown with the takes weighs what the document actually discloses, so the two can disagree, for example when a trial that missed its main goal is described in upbeat language.
Form Type
6-K
Rhea-AI Filing Summary
BP PLC updated its expectations for third-quarter 2026, including reported upstream production of 2,190 to 2,240mboe/d, compared with 2,201mboe/d in the second quarter. Gas and low carbon energy production is expected at 775 to 795mboe/d, while oil production and operations is expected at 1,415 to 1,445mboe/d. Products results are expected to include stronger realized refining margins of +$1.9 to 2.1 billion; refining throughput is expected at 1,375 to 1,405mb/d, versus 1,467mb/d.
BP expects third-quarter net debt of $13.5 to 14.5 billion, versus $22.3 billion in the second quarter, and expects the combined total of net debt, hybrid bonds, leases and Gulf of America settlement liabilities to reduce by around $9.0 to 10.0 billion. Expected post-tax adjusting items relating to impairments are $3.0 to 4.5 billion, primarily attributable to transition businesses in gas and low carbon energy, and excluded from underlying replacement cost profit. The statement says its information is not comprehensive of all factors affecting results and is not an estimate of those results; actual results may vary. Results are scheduled for October 30, 2026.
Key Figures
Reported upstream production: 2,190 to 2,240mboe/d
Realized refining margins: +$1.9 to 2.1 billion
Refining throughput: 1,375 to 1,405mb/d
+3 more
6 metrics
Reported upstream production
2,190 to 2,240mboe/d
Expected for third quarter 2026
Realized refining margins
+$1.9 to 2.1 billion
Expected impact in third quarter 2026
Refining throughput
1,375 to 1,405mb/d
Expected for third quarter 2026
Net debt
$13.5 to 14.5 billion
Expected at the end of third quarter 2026
Post-tax adjusting items relating to impairments
$3.0 to 4.5 billion
Expected in third quarter 2026
Group underlying effective tax rate
Around 30%
Expected for third quarter 2026
Key Terms
underlying replacement cost (RC) profit, post-tax adjusting items, Refining indicator margin (RIM), underlying effective tax rate (ETR), +1 more
5 terms
underlying replacement cost (RC) profit financial
"excluded from underlying replacement cost profit"
post-tax adjusting items financial
"post-tax adjusting items relating to impairments"
Refining indicator margin (RIM) financial
"Refining indicator margin (RIM) is a simple indicator"
underlying effective tax rate (ETR) financial
"Underlying effective tax rate (ETR) is a non-IFRS measure"
Realizations financial
"Realizations are the result of dividing revenue generated from hydrocarbon sales"
FAQ
AI-generated questions and answers. How Rhea-AI works. Not financial advice.
What is BP's expected third-quarter 2026 net debt?
BP expects net debt of $13.5 to 14.5 billion at the end of the third quarter, compared with $22.3 billion in the second quarter. It also expects the total of net debt, hybrid bonds, leases and Gulf of America settlement liabilities to reduce by around $9.0 to 10.0 billion compared with the second quarter.
How much impairment does BP expect in the third quarter of 2026?
BP expects third-quarter post-tax adjusting items relating to impairments in the range of $3.0 to 4.5 billion. The charges are primarily attributable to transition businesses in the gas and low carbon energy segment and are excluded from underlying replacement cost profit.
What effective tax rate does BP expect for the third quarter of 2026?
BP expects its group underlying effective tax rate to be around 30% in the third quarter, due to the geographical mix of profits. BP said it will provide updated full-year effective tax rate guidance within its third-quarter results.
AI-generated analysis. How Rhea-AI works. Not financial advice.
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 6-K
Report of Foreign Issuer
Pursuant to Rule 13a-16 or 15d-16 of
the Securities Exchange Act of 1934
13
October, 2026
BP p.l.c.
(Translation
of registrant's name into English)
1 ST JAMES'S SQUARE, LONDON, SW1Y 4PD, ENGLAND
(Address
of principal executive offices)
Indicate
by check mark whether the registrant files or will file
annual
reports
under cover Form 20-F or Form 40-F.
Form
20-F |X| Form 40-F
---------------
----------------
Indicate
by check mark whether the registrant by furnishing the
information
contained
in this Form is also thereby furnishing the information to
the
Commission
pursuant to Rule 12g3-2(b) under the Securities Exchange Act
of
1934.
Yes No
|X|
---------------
--------------
|
Exhibit
1.1
|
3Q26 bp
Trading Statement Part 1 of 1 dated 13 October 2026
|
Exhibit 1.1
|
|
 |
|
FOR IMMEDIATE RELEASE
|
|
|
London 13 October 2026
|
|
|
BP p.l.c. Trading Statement
|
Third quarter 2026 trading statement
The following Trading Statement provides a summary of BP p.l.c.'s
(bp) current estimates and expectations for the third quarter of
2026, including data on the economic environment as well as group
performance during the period. The information presented is not
comprehensive of all factors which may impact bp's group results
for the third quarter 2026 and is not an estimate of those
results.
Also refer to bp's second quarter 2026 group results announcement
on 4 August 2026 for third quarter and full year 2026 guidance
items which continue to apply unless explicitly stated. A summary
of that guidance is provided in the Appendix to this Trading
Statement. All information provided is subject to the finalization
of bp's financial reporting processes and actual results may vary.
See the Glossary for a definition of guidance items included in
this Trading Statement.
bp's group results for the third quarter 2026 are scheduled to be
published on 30 October 2026.
bp will host a strategy and outlook update on 15 December 2026 in
New York City. bp's financial
calendar is available at bp.com/financialcalendar.
Updated 3Q 2026 guidance
Earnings considerations for 3Q 2026 underlying RC profit before
interest and tax, relative to 2Q 2026:
● Reported
upstream production in the
third quarter is expected to be 2,190 to 2,240mboe/d (2Q 2026:
2,201mboe/d), mainly reflecting seasonal maintenance recovery
partly offset by bp's reduced equity interest in Latin America.
Third quarter includes the impact of continued disruption in the
Middle East and no impact from weather events in the Gulf of
America. Within this,
◦
gas & low carbon energy is expected to be 775 to
795mboe/d (2Q 2026: 765mboe/d).
◦
oil production & operations is expected to be 1,415 to
1,445mboe/d (2Q 2026: 1,436mboe/d).
● Gas
& low carbon energy segment: realizations, compared to the prior quarter, are
expected to have an impact in the range of +$0.1 to 0.3 billion,
including the impact of changes in non-Henry Hub natural gas
markers. The gas marketing and trading result is expected to be
significantly higher compared with the second
quarter.
● Oil
production & operations segment: realizations, compared to the prior quarter, are
expected to have an impact in the range of $(0.2) to (0.4) billion
including the impact of changes in non-Henry Hub natural gas
markers. Exploration write-offs are expected to be significantly
lower due to the prior quarter impact of the Bay Du Nord sale.
DD&A is expected to be slightly higher due to a change in
production mix. Prior quarter equity accounted earnings benefited
from higher contributions in Latin America, which are not expected
to repeat in the third
quarter.
● Customers
& products segment: compared to the prior quarter, results are
expected to reflect the following factors:
◦ customers
- significantly lower result, driven
by weaker fuels margins and higher base oil prices in Castrol, as
well as a lower contribution from midstream, partly offset by
slightly higher volumes due to seasonal
effects.
◦ products
- stronger realized refining margins
in the range of +$1.9 to 2.1 billion. We expect throughput of 1,375
to 1,405mb/d (2Q 2026: 1,467mb/d), reflecting the completion of the
Gelsenkirchen divestment on 31 July and a lower planned turnaround
and maintenance activity. The oil trading result is expected to be
broadly flat compared with the second quarter.
Other financial considerations for 3Q 2026
● The
group underlying effective tax rate for the third quarter is
expected to be around 30%, due to the geographical mix of profits.
We will provide updated full year ETR guidance within our third
quarter results.
● Net
debt at the end of the third quarter is expected to be in the range
of $13.5 to 14.5 billion (2Q 2026: $22.3 billion). This reduction
includes:
◦
the redemption of $1.0 billion of hybrid securities on
30 September 2026. Remaining hybrid bonds and securities are
expected to be around $12.0 billion at 3Q 2026 (2Q 2026: $13.0
billion);
◦
higher income taxes paid of around $1.0
billion;
◦
working capital release in the range of $0 to 1.0
billion; and;
◦
capital expenditure of around $3.0
billion
As
a result, we expect the total of net debt, hybrid bonds, leases and
Gulf of America settlement liabilities to reduce by around $9.0 to
10.0 billion compared with the second quarter.
● The
third quarter results are expected to include post-tax adjusting
items relating to impairments in the range of $3.0 to 4.5 billion.
These charges are primarily attributable to transition businesses
in the gas & low carbon energy segment and are excluded from
underlying replacement cost profit.
Underlying replacement cost (RC) profit before interest and tax,
underlying effective tax rate, net debt, and working capital (after
adjusting for inventory holding gains or losses, fair value
accounting effects and other adjusting items) are non-IFRS
measures.
Trading conditions and rules of thumb
The marker prices and margins below do not represent the actual
prices or margins realized by bp during the given
periods.
● Brent
averaged $96.99/bbl in the third quarter 2026 compared to
$103.85/bbl in the second quarter 2026.
● US
gas Henry Hub first of month index averaged $2.96/mmBtu in the
third quarter 2026 compared to $2.90/mmBtu in the second quarter
2026.
● The
bp RIM averaged $46.7/bbl in the third quarter 2026 compared to
$29.6/bbl in the second quarter 2026.
Rules of thumb below are intended to give directional indicators of
the impact of changes in the trading environment on bp's 2026
full-year pre-tax results. These rules of thumb are approximate and
based upon bp's current portfolio of oil and gas businesses. The
weighting of the rules of thumb for Brent and Henry Hub is an
approximate split of 80% to oil production & operations and 20%
to gas & low carbon energy.
The relationship between prices and results is not necessarily
linear across a wide range of oil and gas prices. Changes in
margins, differentials, seasonal demand patterns, operational
issues, hedge positions and other factors including timing of
acquisition and divestment activity, can also materially impact the
results. Hedging activity impacts the Henry Hub rule of thumb and
as a result should not be treated as representative of the
longer-term sensitivity.
Significant differences between the estimates implied by the
application of the rules of thumb and the actual results themselves
may also arise due to complex mechanisms for calculating government
shares of oil and gas revenues in some jurisdictions, depending on
price levels.
The bp Refining Indicator Margin rule of thumb reflects the
sensitivity of the group's results to changes in refining margins.
However, actual margins realized by bp may vary due to a variety of
factors, including the actual mix of a crude and product for a
given quarter. Under the current market conditions, and
resulting heightened volatility in commodity and refined product
prices, crude differentials, transportation costs and product mix
may vary significantly. See Refining Indicator
Margin link for more
information.
Further information on prices and bp's current rules of thumb can
be found at the following link: bp.com Rules of
Thumb
Rules of thumb
|
Operating environment rules of thumb for the full year
2026
|
Impact on pre-tax replacement cost operating profit
|
|
Oil pricea
Brent +/- $1/bbl
|
$340m
|
|
Natural gas pricea
Henry Hub +/- $0.10/mmBtu
|
$40m
|
|
Refining indicator margin
RIM +/- $ 1/bbl
|
$450m
|
a.
Combined indicator for oil production
& operations and gas & low carbon
energy.
Appendix
2026 guidance summary
|
|
2Q 2026
|
Third quarter 2026
|
Full year 2026a
|
|
|
Guidance area
|
reported
|
Initial guidancea
|
Updated guidance
|
guidance
|
|
Reported upstream productionb
(mboe/d)
|
2,201
|
2,100 to 2,250
|
2,190 to 2,240
|
2,180 to 2,270
|
|
Underlying upstream production (mboe/d)
|
-
|
-
|
-
|
Broadly flat vs 2025; OPO broadly flat and G&LCE
lower
|
|
Oil production & operations production (mboe/d)
|
1,436
|
-
|
1,415 to 1,445
|
-
|
|
Gas & low carbon energy production (mboe/d)
|
765
|
-
|
775 to 795
|
-
|
|
Customers ($ billion)
|
1.8
|
Significantly lower result, broadly flat volumes, lower midstream
and lower Castrol earnings
|
Significantly lower result, weaker fuels margins and higher base
oil prices in Castrol, as well as lower contribution from
midstreams, partly offset by slightly higher volumes
|
Cash flow growth supported by structural cost reductions, partly
offset by divestments; lower Castrol depreciation; fuel margins
remain sensitive
|
|
Refining margins
|
-
|
Remain elevated and sensitive to the cost of supply and market
conditions
|
Stronger realized refining margins in the range of +$1.9 to 2.1
billion
|
Remain sensitive to the cost of supply and market
conditions
|
|
Refining throughput (mb/d)
|
1,467
|
1,300 to 1,360, reflecting the completion of the
Gelsenkirchen divestment and a lower level of planned turnaround
activity
|
1,375 to 1,405, reflecting the completion of the Gelsenkirchen
divestment on 31 July and a lower planned turnaround and
maintenance activity
|
1,360 to 1,410
|
|
DD&A ($ billion)
|
4.1
|
-
|
-
|
17.0 to 17.5
|
|
Group underlying effective tax ratec
(%)
|
34
|
-
|
Around 30%
|
35 to 40 (to be updated at 3Q results)
|
|
Capital expenditure ($
billion)
|
3.1
|
-
|
3.0
|
13.5 to 14.0
|
|
Divestment and other proceeds ($ billion)
|
0.6
|
-
|
-
|
$8 to 9 billion, including $6 billion from the announced Castrol
transaction
|
|
Income taxes paid ($ billion)
|
1.4
|
1.0 higher
|
1.0 higher
|
-
|
|
Hybrid bonds and securities ($ billion)
|
13.0
|
Repay $1.0 billion perpetual subordinated hybrid
securities
|
Repay $1.0 billion perpetual subordinated hybrid
securities
|
-
|
|
Working capital release / (build) ($ billion)
|
(1.0)
|
-
|
0 to 1.0
|
-
|
|
Net debt ($ billion)
|
22.3
|
-
|
13.5-14.5
|
-
|
|
Gulf of America oil settlement payments ($ billion)
|
1.1
|
-
|
-
|
$1.6 billion pre-tax, including $0.4 billion in 1Q and $1.1 billion
in 2Q
|
a.
Initial guidance is based on bp's second quarter and half
year 2026 group results announcement. Refer to that announcement
and bp.com for the full guidance and relevant definitions. A dash
indicates that no directly comparable guidance was
provided.
b.
Because of rounding, upstream production may not agree
exactly with the sum of gas & low carbon energy and oil
production & operations.
c.
Underlying effective tax rate is sensitive to a range
of factors, including the volatility of the price environment and
its impact on the geographical mix of the group's profits and
losses.
Glossary
Net debt is a non-IFRS
measures. Net debt is calculated as finance debt, as shown in the
balance sheet, plus the fair value of associated derivative
financial instruments that are used to hedge foreign currency
exchange and interest rate risks relating to finance debt, for
which hedge accounting is applied, less cash and cash equivalents.
Net debt does not include accrued interest, which is reported
within other receivables and other payables on the balance sheet
and for which the associated cash flows are presented as operating
cash flows in the group cash flow statement. The derivatives are
reported on the balance sheet within the headings 'Derivative
financial instruments'. The nearest equivalent measure on an IFRS
basis is finance debt. A reconciliation of finance debt to net debt
is provided in the Stock Exchange Announcement.
We are unable to present reconciliations of forward-looking
information for net debt to finance debt, because without
unreasonable efforts, we are unable to forecast accurately certain
adjusting items required to present a meaningful comparable IFRS
forward-looking financial measure. This item includes fair value
asset (liability) of hedges related to finance debt and cash and
cash equivalents, that are difficult to predict in advance in order
to include in an IFRS estimate.
Realizations are the result of
dividing revenue generated from hydrocarbon sales, excluding
revenue generated from purchases made for resale and royalty
volumes, by revenue generating hydrocarbon production volumes.
Revenue generating hydrocarbon production reflects the bp share of
production as adjusted for any production which does not generate
revenue. Adjustments may include losses due to shrinkage, amounts
consumed during processing, and contractual or regulatory host
committed volumes such as royalties. For the gas & low carbon
energy and oil production & operations segments, realizations
include transfers between businesses and are based on sales by
consolidated subsidiaries only - this excludes equity-accounted
entities.
Refining indicator margin (RIM) is a simple indicator of the weighted average of
bp's crude slate and product yield as deemed representative for
each refinery. Actual margins realized by bp may vary due to a
variety of factors, including the actual mix of a crude and product
for a given quarter.
Replacement cost (RC) profit or loss reflects the replacement cost of inventories sold
in the period and is calculated as profit or loss attributable to
bp shareholders, adjusting for inventory holding gains and losses
(net of tax). RC profit or loss for the group is a non-IFRS
measure. The nearest equivalent measure on an IFRS basis is profit
or loss attributable to bp shareholders.
Underlying effective tax rate (ETR) is a non-IFRS measure. The underlying ETR is
calculated by dividing taxation on an underlying replacement cost
(RC) basis by underlying RC profit or loss before tax. Taxation on
an underlying RC basis for the group is calculated as taxation as
stated on the group income statement adjusted for taxation on
inventory holding gains and losses and total taxation on adjusting
items. Information on underlying RC profit or loss is provided
below. Taxation on an underlying RC basis presented for the
operating segments is calculated through an allocation of taxation
on an underlying RC basis to each segment. bp believes it is
helpful to disclose the underlying ETR because this measure may
help investors to understand and evaluate, in the same manner as
management, the underlying trends in bp's operational performance
on a comparable basis, period on period. Taxation on an underlying
RC basis and underlying ETR are non-IFRS measures. The nearest
equivalent measure on an IFRS basis is the ETR on profit or loss
for the period.
Underlying RC profit or loss before interest and tax
for the operating segments or
customers & products businesses is a non-IFRS measure and is
calculated as RC profit or loss including profit or loss
attributable to non-controlling interests before interest and tax
for the operating segments and excluding net adjusting items for
the respective operating segment or business. The nearest
equivalent measure on an IFRS basis for segments and businesses is
RC profit or loss before interest and taxation.
Upstream includes oil and
natural gas field development and production within the gas &
low carbon energy and oil production & operations segments.
Upstream production includes bp's share of equity-accounted
entities.
Working capital is movements in
inventories and other current and non-current assets and
liabilities as reported in the condensed group cash flow
statement.
Change in working capital adjusted for inventory holding
gains/losses, fair value accounting effects relating to
subsidiaries and other adjusting items is a non-IFRS measure. It is
calculated by adjusting for inventory holding gains/losses reported
in the period; fair value accounting effects relating to
subsidiaries reported within adjusting items for the period; and
other adjusting items relating to the non-cash movement of US
emissions obligations carried as a provision that will be settled
by allowances held as inventory. This represents what would have
been reported as movements in inventories and other current and
non-current assets and liabilities, if the starting point in
determining net cash provided by operating activities had been
underlying replacement cost profit rather than profit for the
period. The nearest equivalent measure on an IFRS basis for this is
movements in inventories and other current and non-current assets
and liabilities.
bp utilizes various arrangements in order to manage its working
capital including discounting of receivables and, in the supply and
trading business, the active management of supplier payment terms,
inventory and collateral.
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. 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. Actual results or outcomes, may differ
materially from those expressed in such statements, depending on a
variety of factors, including (without limitation): the extent and
duration of the impact of current geopolitical and market
conditions including price fluctuations in crude oil, natural gas
and refined products; changes in demand for bp's products; currency
fluctuations; drilling and production results; reserves estimates;
sales volume and sales mix numbers; supply and demand imbalances
including as a result of direct or indirect restrictions on
production or disruptions to supply; regional pricing differentials
and refining margins; seasonal impacts on product demand and
operating expenses; resolution of trading and derivative positions
for the quarter; 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; natural
disasters and adverse weather conditions; changes in public
expectations and other changes to business conditions; wars,
regional conflicts including the Middle East conflict and acts of
terrorism; cyber-attacks or sabotage as well as those factors
discussed under "Risk factors" in bp's Annual Report and Form 20-F
2025 as filed with the US Securities and Exchange Commission.
Furthermore, additional factors may exist that will be relevant to
bp's group results for the third quarter of 2026 that are not
currently known or fully understood. Neither bp nor any of its
subsidiaries assumes any obligation to update, revise or supplement
any forward-looking statement contained in this announcement to
reflect future circumstances, events or information.
The contents of websites referred to in this announcement do not
form part of this announcement.
Contacts
|
|
London
|
Houston
|
|
|
|
|
|
Press Office
|
Rita Brown
|
Paul Takahashi
|
|
|
+44 (0) 7787 685821
|
+1 713 903 9729
|
|
|
|
|
|
Investor Relations
|
Craig Marshall
|
Graham Collins
|
|
bp.com/investors
|
+44 (0) 203 401 5592
|
+1 832 753 5116
|
|
|
|
|
BP p.l.c.'s LEI Code 213800LH1BZH3DI6G760
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf
by the undersigned, thereunto duly authorized.
|
|
BP
p.l.c.
|
|
|
(Registrant)
|
|
|
|
|
Dated: 13
October 2026
|
|
|
|
/s/
Alasdair Murray
|
|
|
------------------------
|
|
|
Alasdair
Murray
|
|
|
Interim
Company Secretary
|