BP profits soar to four-year high after boost from Iran war

It came as new boss Meg O’Neill said she is taking “urgent action” to create more value for shareholders and revealed plans to sell off its US biogas business, Archaea.

The FTSE 100 company revealed its preferred profit measure – underlying replacement cost profit – surged by around 78 per cent to 5.7 billion US dollars (£4.2 billion) for the second quarter of 2026, compared with the previous three months.

The sharp jump in profits, which surpassed analyst predictions, came as its refining and trading business benefited from rising prices during the Iran war.

Rivals including Shell and ExxonMobil have also reported stronger profits after the boost linked to the conflict.

The group confirmed plans to move further away from renewables, revealing plans to sell off its US renewable natural gas business Archaea.

The move is part of efforts under the leadership of Ms O’Neill, who joined the firm in April, to sell off non-core assets as part of a strategy overhaul.

Last week, BP said it was putting its UK North Sea business up for sale after 60 years of production.

Bosses have said the group is also seeking to improve cost efficiencies in order to boost profitability.

Ms O’Neill said: “We are not making the most of our potential.

“Our performance over the past few years has not met our own expectations, let alone those of our shareholders.

“We have not delivered consistently, we have written off too much value, and our costs and liabilities are not resilient enough in a low price environment.

“We know what we need to do, we are taking urgent action and I am confident that this is how we will grow long-term value for shareholders.”

Derren Nathan, head of equity research at Hargreaves Lansdown, said: “Meg O’Neill’s first full quarter at the helm of BP has come alongside some bumper profits and a welcome reduction in net debt.

“While much of that has been down to high commodity prices, there’s been some strong strategic progress too as the company drives towards a simpler and more capital-efficient portfolio.

“Completing the disposal of the Gelsenkirchen refinery and putting the North Sea assets up for sale are all part of leaning into higher-returning assets.

“While the new Burnham government is making noises around opening up the field to further development, BP’s decision is a stark reminder of the North Sea’s maturity and exposure to high tax rates.

“Third quarter guidance points to some softness with Middle East disruption, the start of the hurricane season, and planned maintenance in the Gulf of America potentially weighing on production.

“As we exit the key summer travel period a seasonal decline in retail and customer-facing operations should also be expected.

“While the refinery disposal will impact throughput, lower levels of maintenance should help with margins. However, none of this points to any underlying weakness.

“Meg O’Neill has clearly set out her stall. She’s not trying to re-invent the wheel, but she is trying to lubricate the bearings and if she succeeds, shareholders will feel the benefits.”

Russ Mould, investment director at AJ Bell, said O’Neill had not had an easy start to life at BP given the acrimonious departure of chair Albert Manifold just weeks into her tenure. However, in just the second set of quarterly numbers under her leadership the company has posted its highest quarterly profit since 2022.

“This strong showing is largely a reflection of the energy shock created by conflict in the Middle East but O’Neill is also wasting no time in putting her stamp on the business. The recent announcement of the sale of the company’s North Sea operations is followed up today by plans to sell its US biogas business Archaea.

“The latter underscores the continuing pivot at BP away from green energy and back towards its historical focus on hydrocarbons.

“BP’s North Sea exit is a blow for the domestic oil and gas sector and follows years of regular interventions in the fiscal terms on offer in the basin.

“The ongoing programme of disposals is intended to help bolster BP’s financial strength and make the business more streamlined. O’Neill will be aware she cannot rely on oil and gas prices remaining this high indefinitely. She needs to make sure it can prosper even when the backdrop is less helpful.”

Campaigners accused BP of profiteering from a “climate crisis”.

Friends of the Earth’s head of campaigns Rosie Downes said: “Clearly not everyone is feeling the pain of the energy crisis.

“While BP banks another round of enormous profits, millions of households are paying the price through sky-high energy bills and a climate crisis accelerating rapidly out of control with increasingly severe heatwaves, wildfires and droughts.”

Simon Francis, coordinator of the End Fuel Poverty Coalition, said: “The price shock profiteers have banked more billions from a crisis that has created real hardship for millions of households.”