Highlights

  • BP’s oil output remained stable in 4Q25, while gas and low carbon output declined.
  • Post-tax impairments of USD 4–5 billion are expected in transition-related businesses.
  • Net debt reduced to USD 22–23 billion by year-end, supported by asset sales.

BP PLC (LSE:BP) released a trading update for the fourth quarter of 2025, providing preliminary estimates of production, segment performance, and financial adjustments ahead of the official results scheduled for 10 February 2026. The update includes details on upstream output, business segment performance, post-tax adjustments, and net debt movements.

Upstream Production and Segment Performance
Total upstream production for 4Q25 is expected to remain largely unchanged from the previous quarter. Oil production was stable, while output in gas and low carbon energy decreased.

In the gas and low carbon segment, results are estimated to fall by USD 0.1–0.3 billion compared with the prior quarter, primarily due to fluctuations in natural gas prices. Gas marketing and trading results are projected to be in line with seasonal averages.

The oil production and operations segment may see a decline of USD 0.2–0.4 billion, influenced by timing effects related to output from the Gulf of America and the UAE.

In the customers and products segment, volumes were lower seasonally. Fuel margins remained largely stable. Refining benefited from higher margins, contributing roughly USD 0.1 billion; however, these gains were partly offset by higher turnaround costs and temporary capacity reductions caused by a fire at the Whiting refinery.

Adjusting Items and Debt Position
BP anticipates post-tax impairments of USD 4–5 billion in 4Q25, primarily linked to transition-related businesses within the gas and low carbon segment. These items are excluded from underlying replacement cost profit.

Net debt is projected to decline to USD 22–23 billion by the end of the quarter, down from USD 26.1 billion in the previous quarter. Asset sale proceeds of approximately USD 3.5 billion contributed to this reduction, bringing total divestment proceeds for 2025 to USD 5.3 billion.

Full-Year 2025 Guidance
For the full year, the underlying effective tax rate is expected to be around 42%, slightly higher than prior guidance of 40%, reflecting shifts in the geographical distribution of profits.

Market Conditions in 4Q25
Brent crude prices averaged USD 63.73 per barrel in 4Q25, down from USD 69.13 per barrel in 3Q25. The US Henry Hub gas index averaged USD 3.55 per million British thermal units (mmBtu), compared with USD 3.07/mmBtu in the previous quarter. BP’s refining indicator margin averaged USD 15.2 per barrel, slightly below the previous quarter’s USD 15.8 per barrel.

Overall, BP maintained stable oil production while facing lower output in gas and low carbon energy. Financial adjustments related to transition businesses and asset sales contributed to a reduction in net debt, providing a solid position ahead of the upcoming full-year results.

Share Perfromance
BP shares trade at GBX 433, down 0.89% today at the time of writing.