BP Reports $5.7 Billion Profit and Exits North Sea

Energy company BP reported a second-quarter underlying replacement cost profit of $5.7 billion, surpassing analyst expectations of $5 billion. This surge, an increase of $2.5 billion over the first quarter, was driven by rising fossil fuel prices caused by conflict between the United States and Iran and disruptions in the Strait of Hormuz. The company also reported an operating cash flow of $10.9 billion and raised its interim dividend by 4%.

Chief Executive Meg O'Neill announced a strategic restructuring to simplify the company's portfolio and refocus on core oil and gas products. As part of this shift, BP is putting its North Sea business up for sale after 60 years, citing that the region is no longer competitive. The company is also selling Archaea Energy, its US-based biogas business acquired for $4.1 billion in 2022, following financial underperformance. Other recent divestments include the Gelsenkirchen refinery and a retail business in Austria.

These windfall profits drew criticism from President Donald Trump, who argued that oil majors were making too much money based on shortages and should return excess profits to the public. O'Neill defended the results as a product of the global commodity market. Meanwhile, O'Neill urged UK Prime Minister Andy Burnham to scrap the energy windfall tax, which currently reaches an effective rate of 78%. The company is now prioritizing balance sheet strength and operational excellence to manage high financial liabilities relative to its size.