Financial Data and Key Metrics Changes - Underlying pre-tax earnings reached $5.3 billion, with underlying net income at $2.2 billion, indicating strong operational performance [2] - Operating cash flow for the quarter was $7.8 billion, supporting a growth target for adjusted free cash flow of 20% CAGR from 2025 to 2027 [2] - Upstream production increased by approximately 3% quarter on quarter, with upstream plant reliability at around 97% [2][4] Business Line Data and Key Metrics Changes - Underlying earnings in the first nine months of 2025 were approximately 40% higher than the same period in 2024 [3] - Refining availability was close to 97%, marking the best quarter in 20 years for the current portfolio [2][4] - The company is on track to achieve organic CapEx below $14 billion [3] Market Data and Key Metrics Changes - The company has made 12 exploration discoveries in 2025, including significant finds in Brazil and Namibia [3][49] - The refining margin environment improved, contributing to better downstream performance [3][88] Company Strategy and Development Direction - The company is focused on a 12-quarter plan, emphasizing operational performance and strategic progress [2] - A $20 billion divestment proceeds target is being pursued, with $5 billion expected from completed and announced proceeds this year [3] - The ongoing portfolio review aims to allocate capital to the highest quality opportunities, with a focus on reducing costs and strengthening the balance sheet [4][17] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the momentum built towards achieving cost and net debt targets, despite market volatility [4] - The company is optimistic about future growth opportunities, particularly in oil production, and plans to update the market on production guidance in February [30] Other Important Information - The company has secured a rig to drill the next appraisal well at Boomerang Bay, with expectations for a flow test by the end of next year [9] - The strategic review of Castrol is progressing well, with strong interest noted [12] Q&A Session Summary Question: Inquiry about Boomerang Bay geological map confidence - Management expressed confidence in the geological map based on extensive data evaluation, noting a significant oil and gas column [6][7] Question: Update on Castrol's strategic review - Management confirmed strong performance from Castrol, with ongoing interest in the strategic review process [11][12] Question: Timing for portfolio simplification announcements - Management indicated that updates on portfolio simplification would be provided as decisions are made, highlighting recent divestments and sanctions [15][17] Question: Insights on Boomerangy and AI deployment - Management reassured that Boomerangy holds significant oil and condensate, and discussed advancements in AI improving operational efficiency [20][22] Question: Production guidance and CapEx implications - Management noted that while production guidance is set, there are options to pivot capital towards short-term or long-term growth opportunities [28][30] Question: CapEx profile and pension fund buy-in - Management clarified that BPX's CapEx is expected to remain around $2.5 billion annually, with ongoing discussions about pension fund de-risking [33][37] Question: Economic details on Iraq's Kirkuk contract - Management refrained from discussing specific economic terms but confirmed initial production tests and ongoing work in Kirkuk [63][64] Question: Venture Global LNG arbitration case - Management expressed satisfaction with the arbitration outcome and indicated that updates on damages would follow [69][70] Question: Gearing ratio considerations - Management emphasized a focus on net debt reduction rather than gearing ratios, with a target to reduce net debt significantly by 2027 [72][74] Question: Structural cost improvements and basin-specific plans - Management highlighted ongoing cost improvements and plans for activity pacing in the Haynesville and Eagle Ford basins [78][80]

Core Viewpoint - BP is aiming to recover from previous strategic errors that have led to its shares underperforming compared to competitors like Shell, Exxon Mobil, and Chevron, with plans for asset sales to strengthen its balance sheet and enhance shareholder value [4]. Group 1: Strategic Direction - BP's new chairman supports the current strategic direction but emphasizes the need for urgent action and potential further asset sales to improve the company's financial standing [1][2]. - Albert Manifold, a key executive, indicated that the company must simplify its complex portfolio and is considering additional asset sales [2][5]. Group 2: Financial Performance and Goals - The company is facing challenges with lower profitability and high debt levels, necessitating a faster implementation of its strategic changes [3]. - BP has set a target of $20 billion in asset sales by 2027 to reduce net debt and has already initiated several sales this year [6]. Group 3: Portfolio Review and Asset Sales - BP is conducting a cost review and evaluating its portfolio to maximize shareholder value, moving away from its previous focus on low-carbon energy to concentrate on fossil fuels [5]. - The lubricants business, Castrol, has been identified as a potential asset for disposal as part of the company's strategy to streamline operations [6].

Financial Performance - BP's underlying replacement cost profit for 2Q25 was $24 billion[21,32] - Operating cash flow for 2Q25 reached $63 billion, including a $14 billion working capital build[21] - The company announced a 4% increase in dividend per ordinary share to 8320 cents for 2Q25[21] - A share buyback of $750 million for 2Q25 was announced[21] Strategic Progress - Upstream production was approximately 23 million barrels of oil equivalent per day (mmboed) in 1H25[20] - BP delivered $1 billion of structural cost reductions[25] - Refining availability exceeded 96% in both 1H25 and 2Q25[20,88] Targets and Guidance - BP aims for adjusted free cash flow growth of over 20% CAGR from 2024 to 2027[64] - The company targets net debt between $14-18 billion by the end of 2027[37,64] - BP is targeting $4-5 billion in structural cost reductions by the end of 2027[41,64] - The company expects capital expenditure to be approximately $145 billion in 2025[37,59]

Group 1: BP's Acquisition Prospects - BP's potential takeover is deemed highly unlikely due to its vast size and operational complexity, according to senior bankers at Moelis & Co. [1][10] - There is currently no obvious buyer for BP, particularly from the United States, and few global acquirers view BP's assets as essential [2][7] - Shell is considered the most compatible acquirer for BP in terms of asset synergies and regulatory feasibility, but its stronger market position makes a deal less attractive at this time [3][10] Group 2: BP's Divestment Challenges - BP's $20 billion divestment plan is facing significant challenges, with its lubricants unit, Castrol, being particularly difficult to sell due to a narrow pool of potential buyers [5][10] - The company may consider selling high-quality oil assets in the United States, which could attract strong interest, but this move might raise concerns about BP's future strategy [6][10] Group 3: Market Position and Alternatives - The consensus among energy dealmakers is that a BP takeover remains a distant prospect, with BP's scale, asset mix, and valuation challenges making any near-term acquisition improbable [7][10] - Investors interested in the energy sector may consider better-ranked stocks such as Subsea 7 S.A. and Energy Transfer LP, which have favorable Zacks Ranks [8][11]