British oil and gas giant, bp, has recently reported its financial results for the fourth quarter of 2025, showcasing a 32% decrease in underlying replacement cost (RC) profit to $1.5bn. This decline is compared to the previous quarter’s figure of $2.2bn in Q3 2025 and a 25% increase from the same period in 2024, where the company reported $1.2bn in profits.
According to bp, the decrease in profit compared to Q3 2025 can be attributed to lower upstream realizations and changes in the production mix. The refining results also weakened due to turnaround activities that reduced throughput and an outage at the Whiting refinery which temporarily cut capacity.
Additionally, the company announced the suspension of its share buyback program and a reduction in spending to support its balance sheet. Despite these challenges, bp reported total revenues and other income of $47.7bn for Q4 2025, which is a slight decrease from $48.1bn in the same period in 2024. Adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) saw an increase to $8.96bn in Q4 2025 from $8.41bn in Q4 2024, marking a growth of around 6.5%.
However, bp reported a loss of $3.4bn for the quarter, compared to a profit of $1.2bn in Q3 2025. This loss includes an inventory holding loss of $700m after tax and adjusting items that reduced results by $4.3bn after tax, which were excluded to calculate underlying RC profit.
Carol Howle, the interim CEO of bp, expressed that 2025 was a year of strong financial results, operational performance, and strategic progress for the company. She emphasized the importance of capital discipline and returns, leading to a reduction in capital expenditure for 2026 to the lower end of the guidance range while driving down the cost base.
For the full year of 2025, bp reported an underlying RC profit of $7.5bn, marking a 16% decrease from $8.9bn in 2024. Total revenues and other income for 2025 were reported at $192.5bn, a slight decrease from $194.6bn in 2024. The company reported adjusted EBITDA of $37.6m for 2025, down 1% from $38m in 2024.
Looking ahead, bp expects reported upstream production in Q1 2026 to remain flat compared to Q4 2025. In the customers business segment, the company anticipates lower volumes on a seasonal basis. For products, bp expects industry refining margins to be lower than in Q4, with a decrease in refinery turnaround activity partly offsetting the change.
In conclusion, bp remains focused on high-grading its portfolio and strengthening the company for long-term value growth. With strategic initiatives in place, such as the $20bn disposal program and a shift towards allocating excess cash to the balance sheet, the company aims to capitalize on opportunities like the Bumerangue discovery in Brazil, which holds promising reserves of around eight billion barrels of liquids.
