BP profits double as oil prices surge amid Middle East conflict
Energy giant records $3.2bn quarterly profit, outpacing analyst expectations by nearly $500m
Quick Look
- BP has reported underlying profits of $3.198bn (£2.366bn) for Q1 2026, more than double the $1.418bn from a year earlier, benefiting from elevated oil prices following attacks that disrupted the Strait of Hormuz.
- The results exceeded analyst expectations of $2.7bn, with the company explicitly attributing the performance to exceptional oil trading.
- Oil has traded above $100/barrel since the Middle East war escalated, though only one month of these higher prices featured in the quarterly results, suggesting further profit growth ahead.
AI-generated summary
The oil and gas producing giant BP has recorded a more than doubling of profits as it benefits from high prices from the Iran war. Benchmark oil prices have soared since early March as attacks led to the effective closure of the Strait of Hormuz, through which about a fifth of the world's oil and liquified natural gas flows.
BP has been a significant beneficiary; its results for the first three months of its financial year show its underlying profits hit $3.198bn (£2.366bn). This is even better than the doubling to $2.7bn (£1.99bn) that analysts had expected. A year earlier, that profit measure had been $1.381bn (£1.021bn).
BP was explicit about the contribution of higher oil prices. The profit "reflects exceptional oil trading", it said.
Oil has consistently cost more than $100 a barrel since the outbreak of war but only one month of higher prices featured in the results released on Tuesday. It made such high profits during the three months, on oil averaging $82.80 a barrel for the benchmark Brent crude. That means it has not yet fully benefited from more expensive oil and that profits are likely to rise yet further.
At the same time, BP has not been badly hit by war in the Middle East; most of its production is in North America, meaning it can benefit from higher prices while experiencing minimal disruption. It did say, however, that production volumes and fuel margins "remain sensitive to conditions and developments in the Middle East". Its share price is up 2.5% on Tuesday morning.
The longer oil prices remain elevated, the worse the cost-of-living impact is going to be on households and businesses. The energy price cap is widely expected to rise by hundreds of pounds for a typical home in July.
Fossil fuel producers are still subject to a windfall tax called the energy profits levy, imposed in the wake of Russia's invasion of Ukraine, after which some companies had record profits. This was reflected in the fact BP paid a headline tax rate of 78% on its taxable profits from its North Sea business.
Energy Secretary Ed Miliband said, "Profiting from a crisis is morally and economically wrong." Referencing the energy profits levy, Mr Miliband said "taxing these windfall profits to help fund support with the cost of living".
Overall, though, BP said its effective tax rate was lower this year than last. Its effective tax rate on profits was 43%, compared with 69% for the same period in 2025.
Environmental groups have reacted angrily to the results. "The oil industry's capacity to profiteer from human misery is almost limitless," said Greenpeace climate campaigner Maja Darlington.
Oil companies, "destroy the climate, push up the cost of living, and rake in billions in profit while innocent civilians die", said Patrick Galey, the head of news investigations at NGO Global Witness. He added, "It's well overdue that we make oil companies pay for the damage they're doing. If they broke it, they need to fix it. It's clear they can afford to."
