BP PLC Stock Outlook, December 2025: Buybacks, Hydrogen Retreat and 2026 Price Targets

Updated: 8 December 2025

BP share price today: near record highs after a big 2025 rally

BP is closing out 2025 with its shares trading not far from record levels, even after a wobble in early December.

BP’s New York–listed American depositary receipts (ADRs) last closed at $35.83 on 5 December 2025, just below their all‑time closing high of $37.24 reached on 3 December and a 52‑week high of $37.64. ^[1] Data from Yahoo Finance and total‑return trackers suggest the stock is up roughly 28–30% year‑to‑date, comfortably ahead of the FTSE 100’s performance. ^[2]

In London, the primary BP listing (ticker BP.) has been trading around the 450–460p zone in early December. The shares fell about 2.6% in one recent session, helping drag the FTSE 100 lower, after a wave of rating changes for BP and sector peer Shell. ^[3] Even with that pullback, UK financial media note that BP shares remain up strongly for 2025 and outpaced Shell in November. ^[4]

From a technical perspective, Investor’s Business Daily reports that BP’s ADRs recently earned a Relative Strength (RS) Rating of 81, indicating they have outperformed a large majority of stocks over the last year and have broken out above a prior $35.88 “buy point” in a flat‑base pattern. ^[5]

The most recent headlines (as of 8 December 2025)

1. Fresh analyst calls: modest upside, widening disagreements

Analyst sentiment on BP is now split between cautious bulls and increasingly vocal bears:

J.P. Morgan Cazenove and City brokers
In Europe, a recent roundup of research shows an average one‑year price target of about €5.52 per share for BP’s Frankfurt‑traded line, implying roughly 5–6% upside from the latest close around €5.23. ^[6]
U.S. and global consensus
For the NYSE‑listed ADRs, MarketBeat’s survey of around 20 analysts puts the average 12‑month target at $43.14, roughly 20% above current levels, with individual targets ranging from $26.50 to $66. ^[7]
StockAnalysis, using a smaller sample of nine analysts, shows a more conservative average target of $39.87 (about 11% upside) and a consensus rating of “Hold”. ^[8]
JPMorgan raises, Bank of America cuts
A 6 December MarketBeat report notes that JPMorgan Chase just raised its target for the London shares from 460p to 480p while keeping a neutral stance, with the broader consensus around 490p. ^[9]
In contrast, Bank of America has reset its 2026 view on European energy and downgraded BP to “underperform”, trimming its target from 440p to 375p and citing a “$60 Brent” world with less upside for integrated oil majors after their big 2025 runs. ^[10]
A new outright “Sell”
A recent note highlighted by TipRanks downgraded BP to “Sell”, cutting a key price objective from 440p to 375p on the back of weaker medium‑term Brent oil forecasts and concerns that a heavy $20bn divestment programme could dilute long‑life cash‑generating assets. ^[11]

The net result: average targets still point to high‑single‑ to low‑double‑digit price upside over 12 months, but the gap between bullish and bearish houses has widened sharply.

2. New buyback, daily share repurchases and bond redemption

Capital returns remain the main pillar of the BP equity story:

$750m buyback running to February 2026
Alongside its Q3 results on 4 November, BP launched a fresh $750 million share buyback programme to run up to 6 February 2026, following completion of an earlier $750m tranche on 31 October. ^[12]
Ongoing daily LSE buybacks
Regulatory notices from the London Stock Exchange and Investegate show BP repurchasing roughly 1.5–1.7 million shares per day on the London and Cboe venues in late November and early December. On 19 November, BP bought about 1.58m shares at an average price near 457p, taking treasury shares above 826m. ^[13]
Additional filings for 3, 4 and 5 December show similar volumes around the mid‑450p level and treasury holdings rising into the mid‑840m range. ^[14]
$2bn bond redemption
In an early‑December announcement, BP said it would redeem $2 billion of outstanding notes on 18 December 2025, continuing its effort to simplify the balance sheet and reduce interest costs. ^[15]
Institutional buying
A new MarketBeat summary of SEC filings notes that Bollard Group LLC increased its BP stake by 12.7% in Q2, purchasing 37,974 additional ADRs and bringing its total holdings to 337,724 shares, valued at just over $10.1m. ^[16]

Taken together, dividend payments plus buybacks give BP a double‑digit “shareholder yield”, which is central to many bullish cases on the stock.

3. Dividend spotlight: BP as a high‑yield income stock

Dividend investors are paying close attention to BP after another payout increase and the share price rally.

BP’s Q3 2025 dividend was set at 8.32 US cents per ordinary share, or $0.4992 per ADR (each ADR equals six ordinary shares), with an ex‑dividend date of 14 November and payment due on 19 December 2025. ^[17]

On a trailing basis, the company has paid about $1.98 per ADR over the last year, implying a dividend yield of roughly 5.4% at recent prices — one of the highest yields among large integrated oil majors. ^[18] Trading platforms tracking the London line estimate a similar 5.4–5.5% yield in sterling terms. ^[19]

A fresh article on 8 December from UK site The Motley Fool goes further, describing BP as offering “one of the highest FTSE 100 dividend yields” and asking how many BP shares an investor would need to generate £1,000 per month in passive income. ^[20]

The investment case for that income stream rests on two assumptions: that BP can safely maintain or grow the dividend and that its share count continues to fall via buybacks, which increases dividends per share even if total cash paid out stays flat.

4. UK windfall tax and policy risk back in the headlines

While BP’s operations are global, its UK North Sea exposure means the UK windfall tax remains a material risk factor.

A column published today in The Times by Brian Gilvary, former BP CFO and now chair of Ineos Energy, criticises the government’s decision to keep the Energy Profits Levy at a 38% surcharge, leading to an effective tax rate of about 78% on many UK oil and gas profits. He warns that this could halve North Sea production between 2022 and 2030 and threaten up to 35,000 jobs while discouraging investment. ^[21]

BP has already signalled reduced appetite for some marginal UK projects, and such taxation makes capital allocation toward the UK continental shelf harder to justify relative to U.S. Gulf of Mexico or Middle Eastern opportunities. Investors now have to weigh generous cash returns against a policy backdrop that is both politically and fiscally volatile.

Fundamentals: Q3 2025 earnings and guidance

BP’s November Q3 2025 results underpin much of the recent strength in the share price.

According to BP’s own reporting and subsequent summaries:

Underlying replacement cost (RC) profit: about $2.2 billion in Q3 2025, modestly above consensus and up on the prior quarter. ^[22]
Revenue: around $49–49.3 billion for the quarter. ^[23]
Operating cash flow: $7.8 billion, around $1.5bn higher than Q2, helped by stronger refining margins and a working‑capital release. ^[24]
Segment performance: the Gas & Low Carbon Energy division delivered RC profit before interest and tax of roughly $1.1bn, while Oil Production & Operations generated around $2.1bn, with higher production partly offset by exploration write‑offs; Customers & Products saw RC profit jump to about $1.6bn from $1.0bn in Q2, helped by high refinery availability. ^[25]

Management’s guidance for Q4 2025 is for upstream production to be broadly flat versus Q3, with slightly higher oil volumes offset by lower gas and low‑carbon output. ^[26]

Alongside the earnings beat, BP confirmed it expects 2025 divestment and other proceeds to exceed $4 billion, ahead of previous guidance. ^[27]

Strategy reset: more oil and gas, less green hydrogen

A key reason BP’s stock has become controversial is its 2025 strategic “reset”.

In February, BP announced it would:

Increase annual oil and gas investment to about $10 billion,
Cut planned “transition” spending by more than $5 billion per year, and
Target $20 billion in asset disposals by 2027, including a review of businesses such as Castrol and parts of solar affiliate Lightsource. ^[28]

BP’s latest Energy Outlook 2025 helps explain this move. Under its “Current Trajectory” scenario, global oil and gas demand declines only slowly, making it unlikely that the world will hit net‑zero emissions by 2050 without far more aggressive policy action. ^[29] Management argues that, in that world, high‑return hydrocarbon projects can still generate substantial cash for decades, funding both shareholder distributions and more selective low‑carbon investments.

Critics, however, see back‑sliding. Research groups and climate‑focused NGOs have warned that BP has scaled back low‑carbon ambitions to a fraction of earlier targets and now resembles a more traditional oil major again. ^[30]

The argument has intensified in the last week due to two high‑profile project cancellations:

Duqm Green Hydrogen Project (Oman) – BP has cancelled plans for a 1.5 GW green hydrogen/green ammonia project at the Duqm industrial port, one of Oman’s flagship energy‑transition schemes. Industry outlets report that this is the second major hydrogen project in the area to be shelved. ^[31]
H2Teesside (UK) – BP has also abandoned its H2Teesside hydrogen and carbon‑capture project at the former Redcar steelworks site, after the UK government and local authorities backed a massive AI data‑centre development on the same land. Reporting in the Financial Times and specialist energy press notes that BP withdrew its development consent order as demand for low‑carbon hydrogen weakened and the data‑centre plan took priority. ^[32]

These decisions are consistent with the February capital‑allocation shift but reinforce concerns that BP is putting near‑term cash generation ahead of long‑term transition positioning.

Portfolio reshaping: Castrol sale talks, U.S. pipelines and North Sea exits

BP is also reshaping its portfolio through disposals and partnerships:

Castrol sale talks
The Financial Times reports that BP is in advanced negotiations to sell most of its Castrol lubricants business to U.S. infrastructure investor Stonepeak in a deal expected to exceed $8 billion, after earlier hopes of a $10bn‑plus price faded. Castrol is estimated to generate more than $1bn of annual profit, making it one of BP’s most profitable downstream units. BP may retain a minority stake, and any sale would contribute to its $20bn disposal target. ^[33]
U.S. midstream stake sale
Alliance News and Reuters coverage in early November noted that BP agreed to sell minority interests in U.S. onshore pipeline assets (in the Permian and Eagle Ford) to investment firm Sixth Street for about $1.5bn, again aligned with the disposal plan and portfolio simplification. ^[34]
North Sea stakes
Earlier in the autumn, Serica Energy announced a deal to acquire BP’s stakes in the P111 and P2544 licences in the UK North Sea for about $232m. ^[35] Subsequent reports indicate that another partner has exercised pre‑emption rights, effectively blocking the original transaction, but BP’s willingness to sell highlights its intention to exit smaller, mature North Sea positions. ^[36]

Credit quality and ESG tensions

Despite the strategic controversy, BP’s balance sheet looks solid on most metrics.

In May 2025, Fitch Ratings affirmed BP’s long‑term issuer default rating at A+ with a Stable outlook, citing strong free cash flow in a moderate oil‑price environment and manageable leverage. ^[37]

However, activists and ESG‑focused investors continue to apply pressure:

The Australasian Centre for Corporate Responsibility (ACCR) has published research arguing that BP’s recent conventional oil and gas spending may be value‑destructive, estimating that about $22bn invested in new upstream projects over six years has only marginal net present value under current price curves, and suggesting BP might be more valuable if it stopped sanctioning new conventional projects. TechStock²
Labour and social issues have also surfaced, including UK media reports that BP will change pay structures for staff at its company‑operated petrol stations (scrapping paid breaks and most bank‑holiday premiums while raising base pay), moves that unions say could effectively reduce take‑home pay and further inflame reputational risk. TechStock²+1

BP stock forecasts for 2026 and beyond

Pulling the various datapoints together, what are markets currently pricing in?

Near‑term: moderate upside plus income
- Consensus 12‑month price targets across major aggregators generally point to single‑ to low‑double‑digit capital upside (roughly 5–20%) on top of a 5%+ dividend yield. ^[38]
- Some brokers, such as Berenberg and Citigroup, see scope for the London shares to trade above 500p, whereas others like Bank of America argue that at around 460p, BP already discounts much of the good news in a $60‑Brent scenario. ^[39]
- U.S. broker Raymond James has repeatedly raised its target for BP ADRs to $40 with an Outperform rating, citing the strategic reset, portfolio reprioritisation and the scale of buybacks. ^[40]
Medium‑term: scenario‑driven debates
- Some investment writers argue that if higher‑for‑longer oil price forecasts play out, BP’s earnings power and capital returns could drive very large upside over the next five years, with at least one widely‑read article suggesting the share price could potentially double under particularly bullish oil assumptions. ^[41]
- Others caution that BP’s long‑term total shareholder return has lagged both the broader market and certain peers, even after the 2025 rally, and that heavy dependence on fossil‑fuel cash flows leaves it vulnerable to policy shocks and volatility in Brent and gas prices. TechStock²+2Trefis+2
Key swing factors for the 2026–2030 story
- Oil and gas prices – Lower medium‑term Brent forecasts are a core plank of the bearish “Sell” and “Underperform” calls. ^[42]
- Execution on disposals and buybacks – Successfully selling businesses like Castrol for attractive multiples and continuing large buybacks could enhance per‑share metrics even in a flat price environment. ^[43]
- Regulation and taxation – The UK windfall tax debate, U.S. pipeline incidents and evolving climate policy all create headline and earnings risk that is difficult to model but impossible to ignore. ^[44]

Key risks to monitor

Investors following BP into 2026 are watching several categories of risk:

Commodity price risk – BP remains heavily exposed to swings in Brent crude and global gas prices; earnings leverage works both ways. ^[45]
Policy and tax risk – The UK’s 78% effective tax rate on North Sea producers, possible future windfall taxes elsewhere and climate policy tightening could impact returns from existing assets. ^[46]
Transition and ESG risk – Scrapping large hydrogen projects in Oman and Teesside improves near‑term capital efficiency but may leave BP less well positioned for a faster‑than‑expected energy transition scenario. ^[47]
Operational and legal risk – Incidents such as the Olympic Pipeline leak in the U.S. illustrate ongoing operational hazards in midstream assets and the potential for fines and litigation. ^[48]

Bottom line: BP stock after the 2025 reset

As of 8 December 2025, BP sits at a crossroads:

The shares trade near multi‑year highs with strong year‑to‑date returns, a 5%+ dividend yield, and a large, ongoing buyback programme that is steadily shrinking the share count. ^[49]
Q3 results confirmed robust cash generation even in a moderating oil‑price environment, and credit agencies such as Fitch continue to view BP’s balance sheet as investment‑grade with a stable outlook. ^[50]
At the same time, BP is row‑backing on flagship low‑carbon projects, facing harsher sector taxes in key jurisdictions and attracting more vocal criticism from climate‑focused investors and some sell‑side analysts. ^[51]

For investors, the current BP story is essentially a trade‑off: a high immediate cash return and shareholder‑friendly capital allocation, in exchange for concentrated exposure to fossil‑fuel cycles and policy risk. Whether that balance is attractive depends on one’s view of future oil and gas prices, the speed of the energy transition and tolerance for political and ESG controversy.