BP Plc (BP)

Equity Research 4 August 2026 | 11:12PM CEST

BP Plc (BP.L) Strong 2Q underpinned by trading strength; clear path to financial delevering and return to growth

BP.L 12m Price Target: 660p Price: 525p Upside: 25.7% BUY BP 12m Price Target: $53.00 Price: $42.44 Upside: 24.9% Michele Della Vigna, CFA | Goldman Sachs Bank Europe SE - Milan branch BP reported a strong 2Q26 result, with RC operating profit of Yulia Bocharnikova US$10.3bn and RC adjusted net income of US$5.7bn, representing a | Goldman Sachs International c.10% earnings beat versus company-compiled consensus, driven by Anastasia Shalaeva exceptional oil trading results, stronger refining margins and robust | Goldman Sachs International performance across its integrated value chain. We continue to believe BP has several differentiated characteristics, including its leading trading franchise, integrated US exposure, deepwater and Key Data _____________________________________ Market cap: £81.8bn / $109.9bn gas growth options, and significant self-help potential through Enterprise value: £110.5bn / $148.5bn 3m ADTV: £217.5mn / $291.5mn deleveraging, portfolio simplification and cost reduction. We United Kingdom Europe Energy and Clean Tech reiterate our Buy rating on the stock and highlight the key drivers M&A Rank: 3 that we believe can support a re-rating: Leases incl. in net debt & EV?: Yes

GS Forecast __________________________________ 1. Trading and integrated downstream continue to differentiate 12/25 12/26E 12/27E 12/28E EBIT ($ mn) New 19,450.0 31,761.5 21,928.9 20,301.4 BP. Strong oil trading, refining, logistics and customer businesses EBIT ($ mn) Old 19,450.0 27,294.3 20,851.2 20,237.9

helped BP capture volatility across global energy markets, EPS ($) New EPS ($) Old supporting a 10% earnings beat in 2Q. Management highlighted P/E (X) Dividend yield (%) 6.0 4.9 5.1 5.3 that trading has contributed an average ~4 percentage points of FCF yield (%)

ROACE uplift over the last six years. We continue to see trading CROCI (%) Net debt/EBITDA (X) 1.0 0.4 0.2 0.1 and downstream optimization as important sources of earnings 3/26 6/26 9/26E 12/26E upside during periods of market dislocation. EPS ($)

2. Strong earnings and FCF generation accelerating balance GS Factor Profile ______________________________ Growth sheet repair. BP generated US$11.9bn of operating cash flow in 2Q26, while financial obligations declined by c.US$7bn qoq. Financial Returns

Management now expects financial obligations to fall to Multiple

US$39-41bn by YE26, allowing BP to achieve its US$14-18bn Integrated

net debt target ahead of plan. Importantly, management reiterated that balance sheet repair remains the key priority, Percentile 20th 40th 60th 80th 100th

noting that “too much cash” is currently servicing liabilities BP.L relative to Europe Coverage BP.L relative to Europe Energy and Clean Tech rather than being returned to shareholders. While investors Source: Company data, Goldman Sachs Research estimates. focused on potential buyback resumption, BP did not provide an See disclosures for details. explicit trigger or timeline and indicated that financial

Goldman Sachs does and seeks to do business with companies covered in its research reports. As a result, investors should be aware that the firm may have a conflict of interest that could affect the objectivity of this report. Investors should consider this report as only a single factor in making their investment decision. For Reg AC certification and other important disclosures, see the Disclosure Appendix, or go to Analysts employed by non-US affiliates are not registered/qualified as research analysts with FINRA in the U.S.

BP Plc (BP.L) Balance Sheet ($ mn) _______________________________________ BUY Rating since Apr 23, 2018 12/25 12/26E 12/27E 12/28E Cash & cash equivalents 36,556.0 36,556.0 36,556.0 36,556.0 Accounts receivable 26,014.0 33,123.2 29,770.1 28,551.9 Inventory 22,499.0 34,592.0 29,903.0 29,818.0 Ratios & Valuation __________________________________________ Other current assets 9,913.0 12,622.1 11,344.3 10,880.1 12/25 12/26E 12/27E 12/28E Total current assets 94,982.0 116,893.3 107,573.4 105,806.0 EV/DACF (X) 4.6 3.8 4.3 4.3 Net…