BP has reported a doubling of its first-quarter profits, driven by the surge in energy prices following the outbreak of the Iran war. The oil major announced on Tuesday that it made a profit of nearly $3.2bn in the first three months of 2026, as measured by its preferred underlying replacement cost metric.
Profits Exceed Expectations
The figure surpassed City analysts' forecasts, coming in significantly higher than the $1.54bn recorded in the fourth quarter of 2025 and the $1.38bn from the same period last year. BP, which faced a shareholder rebellion just last week, attributed part of the strong performance to an “exceptional” contribution from its oil trading operations.
Impact of Middle East Conflict
The first quarter of 2026 included the sharp rise in oil and gas prices in March, after the Iran war began in late February, disrupting energy supplies from the region. BP’s new CEO, Meg O’Neill, acknowledged the impact of the Middle East conflict, stating that the company is operating in an “environment of conflict and complexity.”
O’Neill added that BP is “working with customers and governments to get fuel where it’s needed,” amid growing fears of jet fuel shortages. She noted: “Overall, our business continues to run well. This was another quarter of strong operational and financial delivery, and we made further progress towards our 2027 targets. We had high plant reliability, high refining availability and increased production in the Gulf of America and at bpx Energy, our US onshore business - keeping production levels steady despite the ongoing disruption.”
Broader Economic Implications
The surge in energy prices is causing concern among central banks, many of which are setting interest rates this week. Overnight, the Bank of Japan opted to leave borrowing costs unchanged, although three policymakers broke ranks and voted for a rate hike.
The agenda for the day includes the ECB survey of consumer inflation expectations in the eurozone at 10am BST, US house price data from S&P/Case-Shiller at 2pm BST, and US consumer confidence data at 3pm BST.
