BP said on Friday that third-quarter underlying replacement cost (RC) profit rose to $8.5bn, up from $5.7bn in the second quarter, helped by what it called a higher-price, higher-margin environment.
The $2.7bn quarterly increase came with operating cash flow of $14.8bn, against $10.9bn in the three months to June, and BP used the cash to cut net debt by $8.4bn to $13.9bn.
Chief executive Meg O’Neill said the quarter was shaped by disruption to trade flows. “These are dynamic times with volatility and disruption to trade flows continuing to define energy markets,” she said.
She said refineries had been running close to capacity to cover shortfalls, shipping was taking longer routes, and releases from strategic and commercial reserves were helping to bridge supply gaps.
BP’s financial obligations, which include financial instruments, fell to $44.3bn from $53.6bn at the end of the second quarter.
The dividend was held at 8.66 cents per ordinary share, the same as in the second quarter.
The combined sum of net debt, hybrid bonds, lease liabilities and Gulf of America settlement liabilities fell by $9.3bn from the second quarter. O’Neill said BP was “still too leveraged” and that strengthening the balance sheet remained its number one job.
BP recognised $4.0bn of impairments in the quarter, linked largely to transition businesses. O’Neill said the company needed to be better stewards of shareholders’ capital.
BP also said it had agreed with the State of Louisiana to speed up its Deepwater Horizon settlement commitments, and would put excess cash flow towards the remaining liabilities in full.
Upstream production was 2,220 thousand barrels of oil equivalent a day, against 2,201 in the second quarter. Upstream plant reliability rose to 95.3% from 92.4%.
Refining availability improved to 96.5% from 94.7%, while refinery throughput fell to 1,396 thousand barrels a day from 1,467, which BP linked to the sale of the Gelsenkirchen refinery at the end of July.
BP said it expected the Castrol divestment to close imminently, unlocking $6bn. In the quarter it also agreed the sale of its Austrian mobility and convenience business and announced plans to market its North Sea and Archaea businesses.
In its US onshore arm, bpx energy, total liquids realisations averaged $55.04 a barrel, down from $61.82 in the second quarter but up from $45.00 a year earlier.
Natural gas realisations at bpx energy were $2.33 per thousand cubic feet, up from $1.64 in the second quarter and close to the $2.35 of the third quarter of 2025.
For oil and gas producers in the UK, the Energy Profits Levy has applied since 26 May 2022. HM Revenue and Customs (HMRC) sets the rate at 35% from 1 January 2023 to 31 March 2028, when a sunset clause ends it.
The levy is charged on top of ring fence corporation tax of 30% and a supplementary charge of 10%.
Under the Energy Security Investment Mechanism, the levy would end early if the six-month average prices of both oil and gas fell to or below set thresholds of $71.40 a barrel and 54 pence a therm, before inflation adjustment.
BP will set out its longer-term plans and capital frame at a strategy and outlook update on 15 December.
