According to Bloomberg, BP has witnessed upward earnings estimate revisions for 2022 and 2023 in the past 30 days. The stock, sporting a Zacks Rank #1 (Strong Buy), is likely to see earnings growth of 116.2% this year.
The price of West Texas Intermediate crude is approaching the $95-per-barrel mark again, highlighting a substantial improvement in the past year. The positive oil price trajectory is a boon for BP’s upstream operations. The favorable oil price scenario and increasing daily oil equivalent production volumes are aiding the energy giant’s bottom line. BP stated that the target of adding a net production of 900 thousand barrels of oil equivalent per day by 2021 from key new projects has been delivered.
BP is expected to gain from the refining business as well. The integrated energy player has a significant portion of its refining capacities in the United States. In the country, BP operates feedstock-advantaged and sophisticated refineries. The refineries are connected to strong logistics and fuel infrastructure. Thus, with a considerable presence in the United States, the energy major is well placed to capitalize on the solid fuel demand, backed by the reopening of the economy and wider distribution of vaccines.
BP is strongly focused on returning capital to shareholders. The integrated player recently announced that it is planning to repurchase $3.5 billion in shares before declaring results for the September quarter.
