BP 2Q26 Trade statement: >$6bn of net debt & equivalents reduction is a significant first step

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BP 2Q26 Trade statement: >$6bn of net debt & equivalents reduction is a significant first step

Global Majors

Global Majors - Market Overweight

BP (BP) July 15, 2026

BP 2Q26 Trade statement: >$6bn of net debt & equivalents Rating:

reduction is a significant first step Outperform

Price:

$41.40

The Wolfe Byte Price Target:

BP's 7/14 trading statement lifts EPS to $0.34/sh (vs stale $0.25/sh consensus), $62

Prior: $61and affirms the first significant progress on deleveraging, with significant % Upside:

momentum ahead. With 50% upside implied by our $62/sh PT is our top major pick. 49.8%

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We see 2Q26 as the first tangible installment to affirm progress on net debt

reduction with 100% of FcF available after the early year decision to cancel buybacks. Company Information

The trading statement published on 7/14 confirms a $6.3bn-$7.3bn pay down of net 52-Week Range $32 - $48

$108,350 Cap. (MM)debt, hybrid bonds & GoA spill costs, part of a capital stock that still consumes 2/3 Market $131,731 Enterprise Value (MM)

of unlevered FcF. Critically, this comes before any meaningful contribution from asset Shares Out. (MM) 2,617.2

sales, and no help from working capital. At strip prices we believe BP has the capacity Avg. Value Traded (MM) $417.56

Adj. Debt to Cap 17.6%

to theoretically reduce net debt to zero by mid 2027, and preload the b/sheet to tackle SI% of Float 0.4%

Hybrid bonds over time as the most expensive part of the capital stack. FCF Yield 17.0%

EV/ EBITDA 4.0x

Greater disclosure on use of cash will be a priority for the 2Q26 call. Aside from the

Price Performancefocus on rebalancing cash distributions, a key takeaway from the recent CEO breakfast

YTD LTM

was to provide greater transparency on the use of cash.