BP’s underlying replacement cost profits fell 16% in 2025 to $7.49 billion, with fourth-quarter profits down 30% from the prior quarter but up 32% year over year as crude price volatility weighed on results.

The company is focused on reducing debt, aiming to trim its roughly $22 billion balance sheet while refocusing on core oil and gas operations after a strategic shift away from some renewables.

Crude prices slipped below $60 a barrel for the first time in nearly five years in BP’s 2025 year-end context, adding pressure on profits.

BP redirected excess cash to strengthen its balance sheet rather than returning it to shareholders through buybacks.

Under new CEO Meg O’Neill, BP’s strategy emphasizes returns from oil and gas and de-emphasizes renewables, marking a sharper focus on hydrocarbons.

Investors and activist groups, including Follow This, are pressing BP to articulate a strategy for preserving shareholder value amid a potential long-term decline in fossil-fuel demand and to reassess its energy-transition plans.

Interim chief executive Carol Howle said BP has progressed on growing cashflows, increasing shareholder returns, reducing costs, and strengthening the balance sheet via asset sales, with urgency to deliver more for shareholders.

Howle emphasized ongoing progress on cash-flow growth, cost reduction, and balance-sheet strengthening, while signaling a need for quicker gains.

Industry context shows rivals trimming buybacks and investments amid weaker prices, with Equinor cutting buybacks and Shell maintaining them.

Analysts note the pause in buybacks as part of de-leveraging amid a weaker balance sheet and lower energy prices, with peers diverging in payout strategies.

BP suspended its share buyback to prioritize debt reduction and to absorb about $4 billion in impairments from renewables and biogas ahead of the new CEO’s arrival.

Historical context includes leadership changes, with the prior chief resigning and the predecessor dismissed over misconduct, framing the current transition.