How to Buy BP Shares in the UK In 2025

With its multinational reach and long history in the oil and gas sectors, BP is a behemoth British-based business and one of the UK’s largest and most actively traded companies. Considering how big BP is — and the essential role it plays in the global fossil fuel trade — I bet many of you UK investors have at least considered adding this company to your portfolios. After all, BP offers exposure to the in-demand energy sector and has rewarded investors over the years with juicy dividends and buybacks. What’s not to like?

Although BP appears to be a solid stock pick, there are always pros and cons when choosing which companies to add to a trading account. For instance, over the past five years, the share price for BP has actually declined by 15.92%, and this company is tied to an industry facing an existential threat from the rise of green energy solutions.

Where does all this information leave you if you’re considering a BP investment? One way to start analysing whether you should buy BP shares in the UK is to look at their latest figures and consider the company’s growth prospects, strategies, and trajectory. After reviewing BP’s latest financials, it’s easier to get a balanced view of how this company might impact your portfolio.

Simple Guide: How to Purchase BP Shares in the UK

Choose a Trading Platform: Download and install a reputable investment app or platform.
Set Up Your Account: Create a free account and have your ID ready for verification.
Complete Tax Forms: Fill out the W-8BEN form if required.
Add Funds: Deposit money into your account using a bank transfer, credit card, or other methods.
Find BP Shares: Search for “BP” within the app.
Purchase Shares: Buy whole or fractional shares as per your preference.
Track Your Investment: Keep an eye on the performance of your shares.
Sell When Ready: Sell your shares when you choose, either withdrawing or reinvesting the funds.

Additional Advice:

Consider other investments like Meta, Tesla, Google, Nvidia, Netflix, Disney, Microsoft or Amazon.
Explore moving cash to a Money Market Fund (MMF) account for interest. Many money market funds offer higher interest rates than traditional savings accounts.
Diversify your portfolio with various companies.

Step-by-Step: Investing in BP Shares for UK Investors

Investing in BP shares via a trading platform is straightforward. Here’s a detailed look at the process:

Create Your Free Account: Download a reputable investment app, register, and create your account. Have your ID or passport handy for verification.
Complete the Necessary Tax Form: Fill out the W-8BEN form to ensure correct taxation for UK residents investing in US stocks like BP.
Fund Your Account: Add funds to your account through bank transfer or credit card.
Search for BP Shares: In the app, search for “BP” to find current share prices and details.
Buy BP Shares: Decide on the number of shares to buy, including fractional shares if desired, and place your order.
Monitor Your Investment: Use the platform’s tools to track the performance of your BP shares. Keep updated on financial news and market trends, and consider other major companies like Tesla or Netflix.
Selling Your BP Shares: When ready, log in, search for “BP,” and sell your shares. Withdraw the funds or reinvest them. Many platforms also offer an option to move cash into an MMF account for higher interest rates.
Tax Implications and Capital Gains: Be aware of potential Capital Gains Tax (CGT) on profits and dividends, especially if your shares are outside an ISA. The CGT allowance changes over time, so staying informed about the current rates and allowances is essential. Always consult with a tax professional for personalised advice.

BP’s Q1 Earnings Report Summary — Bullet Points on BP’s Latest Financials

If you just looked at the bottom line, BP’s first quarter 2024 earnings report wasn’t all that hot. Immediately after publishing their results, media outlets focused on the company’s 40% profit decline compared to 2023. This profit number — which came in at $2.7 billion — also missed Wall Street analysts’ expectations by roughly 5%, and it caused a slight drop in shares after the earnings release on May 7th, 2024.

One specific reason behind this lacklustre performance had to do with a major outage at BP’s Whiting, Indiana facility during the quarter. However, the larger macroeconomic headwind for BP has been the dip in oil and gas prices versus Q1 2023, which has had a major impact on the company’s revenue.

Despite all of this doom and gloom, BP’s Q1 2024 report had some bright spots. For example, the company noted growth in oil and gas production compared with Q1 of 2023 and the opening of the advanced Azeri Central East platform in the Caspian Sea. BP also confirmed a share repurchase plan of $1.75 billion within three months and promised to keep its dividend of 7.27 cents per share at the same level.

Basic metrics for BP fundamental analysis

BP’s first quarter of 2024 results provide a comprehensive view of its financial health and operational performance. Here are some key metrics and insights:

Profit and Revenue

Profit for the Period: BP reported a profit of $2.3 billion attributable to BP shareholders in the first quarter of 2024. This was a significant increase compared to $0.4 billion in the fourth quarter of 2023 but a decrease from $8.2 billion in the first quarter of 2023.
Sales and Other Operating Revenues: The total sales and operating revenues for the first quarter of 2024 amounted to $48.9 billion, down from $52.1 billion in the fourth quarter of 2023 and $56.2 billion in the first quarter of 2023.

Cash Flow

Operating Cash Flow: BP generated $5.0 billion in operating cash flow in the first quarter of 2024, a decrease from $9.4 billion in the fourth quarter of 2023 and $7.6 billion in the first quarter of 2023.

Capital Expenditure

Capital Expenditure: BP’s capital expenditure for the first quarter of 2024 was $4.3 billion, slightly down from $4.7 billion in the fourth quarter of 2023 but higher than $3.6 billion in the first quarter of 2023.

Debt and Dividend

Net Debt: BP’s net debt stood at $24.0 billion at the end of the first quarter of 2024, up from $20.9 billion at the end of the fourth quarter of 2023 and $21.2 billion at the end of the first quarter of 2023.
Dividend: BP announced a dividend of 7.27 cents per ordinary share for the first quarter of 2024, maintaining the same level as the previous quarter and up from 6.61 cents in the first quarter of 2023.

Performance by Segment

Gas & Low Carbon Energy: This segment reported an underlying replacement cost (RC) profit before interest and tax of $1.7 billion for the first quarter of 2024, down from $3.5 billion in the same period of 2023.
Oil Production & Operations: The underlying RC profit before interest and tax for this segment was $3.1 billion, compared to $3.3 billion in the first quarter of 2023.
Customers & Products: This segment’s underlying RC profit before interest and tax was $1.3 billion in the first quarter of 2024, down from $2.8 billion in the same period of 2023.

Strategic Initiatives

BP is focused on reducing costs, with a target of $2 billion in cash cost savings by the end of 2026 through portfolio high-grading, digital transformation, and supply chain efficiencies.
The company continues to invest in its transition growth engines, such as renewable energy and EV charging, while also maintaining its oil, gas, and refining businesses.

These metrics and insights reflect BP’s strategic initiatives, financial performance, and the challenges it faces in balancing traditional oil and gas operations with a transition to low-carbon energy sources.

Building an Investment Thesis: Why Should UK Investors Buy BP?

Although BP’s Q1 2024 profits came in well below Q1 2023 and moderately lower than analysts’ estimates, there are still bull cases to be made for investing in BP. On the positive side, BP highlighted its continued growth and dominance in the fossil fuels industry with its increased oil and gas production and investment in the Azeri Central East platform. Outside of its “bread and butter” business, BP highlighted investments in renewable energy like wind, solar, and electric charging stations to position itself for a transition into the “green wave.”

BP also remains a favourite for income-oriented investors thanks to its reliable payouts and buybacks. The $1.75 billion share buyback program and steady dividend make BP shares an attractive offering at current levels, especially if you feel prices for crude oil and gas will rebound in the future.

What’s the Market Sentiment for BP Shares?

Similar to the 2024 Q1 report, feelings toward BP shares are mixed in the current market. Year-to-date, the share price for BP is flat, and over the past year, it’s up marginally with about a 1% gain. Also, as I mentioned above, BP shares have been on a long-term downtrend, with an over 15% loss in the past five years.

The global demand and trading prices for oil continue to be the major drivers for BP’s share performance, and investors have many questions about how this company will effectively pivot to a world increasingly interested in oil alternatives. There are also concerns over BP’s leadership after the sudden departure of BP’s former CEO Bernard Looney and the company’s missed earnings expectations.

Still, many analysts covering BP stock have favourable expectations for the company’s prospects, especially at current levels. Of the seven Wall Street analysts covered by TipRanks, four rate BP a buy, three hold, and no sells.

Is BP a Good Long-Term Investment?

Given the global push for greener energy sources, there are legitimate questions on how big oil and gas companies like BP will continue to thrive in the far-off future. While demand for fossil fuels probably isn’t going away overnight, it’s unclear which one of the major multinational companies will best pivot into green energy and grow profits, revenues, and margins decades down the line.

BP has made a steady recovery over the past three years, with its share price rising by an impressive 73% since the pandemic recession. This impressive feat, combined with a relatively high dividend yield, makes BP a viable option for long-term investors.

In the near term, BP appears to be in a healthy position and still has many shareholder-friendly features like its buyback and dividend. It’s also clear BP is working to make inroads in alternative energy sectors like wind and solar. Whether you think BP is a good long-term buy depends on your time horizon and your opinion on oil and gas demand, the prices for crude oil, and whether BP can effectively transition into the world of green energy before its competitors.

Volatile Profits, Resilient Dividends

While oil and gas prices have been highly volatile and BP’s profitability has been affected, the company has managed to keep its dividends stable. BP’s profit more than doubled in 2022 before halving in the most recent financial year. That kind of unpredictability is inherent to the sector’s volatility.

The following table reflects the cash dividends paid per ordinary share by BP since 2014:

Strong financials

BP’s financial health further strengthens the case for it being a long-term investment. The company’s net debt has decreased slightly, resulting in a modest net gearing ratio of just 25%. This low level of debt provides BP with the financial flexibility to navigate periods of lower oil and gas prices without compromising future profits or hastily repaying debt. Additionally, a strong cash flow supports the potential for ongoing dividend increases, share buybacks, and reinvestments into the company’s asset base for future growth.

Valuation and growth potential: Is BP overvalued or undervalued?

BP’s shares currently trade at a price/earnings (PE) ratio of just 8.55, suggesting they are undervalued relative to the broader market.

Despite the volatility of oil and gas prices, BP has shown impressive resilience through its strong financial management and commitment to shareholder returns. Its high dividend yield, solid financial position, and undervalued stock price make BP an option that should at least be considered, even for younger investors. While there are risks associated with the cyclical nature of the oil and gas industry, BP’s strategies and financial health suggest it can weather these challenges effectively.

Investors seeking a blend of income and potential capital growth should consider BP a strong candidate for their portfolios. The company’s focus on maintaining and growing dividends, coupled with a healthy balance sheet and low valuation has potential as a long-term investment.

The Bear Case: Why You Shouldn’t Buy BP Shares

Although BP shares have long been an attractive option for income-oriented UK investors, there are a few unique risks you need to consider before holding BP in your portfolio. A glaring weakness for long-term investors is BP’s heavy dependence on fossil fuels. As more countries move toward renewable sources of energy, there are existential threats to BP’s business model. Investors also have to consider the potential scrutiny and fines BP will face as Environmental, Social, and Governance (ESG) policies become more prevalent.

Former CEO Bernard Looney highlighted the “energy trilemma”—the need for secure, affordable, and low-carbon energy. To tackle this, BP plans to invest up to $8 billion more in oil and natural gas by 2030. This strategy is designed to ensure energy security while gradually transitioning to clean energy. Investors were enthusiastic, expecting increased profits from expanded oil and gas operations, leading to BP’s stock outperforming its peers.

However, this is not the first time BP has tried to steer the wheel in a totally different direction. Just a few years ago, in 2020, BP announced a significant shift towards clean energy. The company aimed to ramp up its annual investment in low-carbon technologies to $5 billion and cut oil and gas production by 40% from 2019 levels. This plan was part of a broader strategy to become a leader in the green energy space, accompanied by a painful dividend reset to support the transition. Unsurprisingly, less than three years later, BP reversed this direction. This flip-flop raises questions about the company’s long-term vision and its ability to stick to a plan.

The frequent shifts between oil and clean energy investments could indicate that BP is more reactive to market conditions than proactive about long-term strategy. The allure of high profits from oil during market upswings seems too tempting for BP to resist, even if it means abandoning previously stated goals. This inconsistency can erode investor confidence, making BP a less attractive option compared to more stable competitors.

Beyond these industry-wide issues, BP has also shown signs of weakness, with lower profits on a year-to-year basis compared with Wall Street analyst forecasts. If you don’t feel demand or the prices for oil and gas will pick up, then BP shares aren’t a great fit for your account.

BP Key Personnel

Murray Auchincloss: Chief Executive Officer (CEO)
Kate Thomson: Chief Financial Officer (CFO)
Gordon Birrell: EVP, Production & Operations
Giulia Chierchia: EVP, Strategy, Sustainability & Ventures
Emma Delaney: EVP, Customers & Products
Anja-Isabel Dotzenrath: EVP, Special Advisor
Kerry Dryburgh: EVP, People & Culture
Emeka Emembolu: EVP, Technology
Carol Howle: EVP, Trading & Shipping
William Lin: EVP, Gas & Low Carbon Energy
Mike Sosso: EVP, Legal

It is important to note that this list may not be exhaustive and could change over time. For the most up-to-date information, you can refer to BP’s official website or other reliable sources.

Brief History of BP

BP, originally known as the Anglo-Persian Oil Company, has a rich history that dates back to 1908, the golden age of the colonial era. Our story begins in 1901 when a swashbuckling Englishman named William Knox D’Arcy struck a deal with Persia (modern-day Iran) to hunt for that sweet, sweet crude.

It took D’Arcy (who had already struck his fortune at the Australian goldmines) seven years of digging, sweating, and probably a few curses before he finally hit the jackpot. It was the oil find of the century, and the Anglo-Persian Oil Company was born as a subsidiary of the Burmah Oil Company. Little did they know that this discovery would set off a chain reaction that would eventually lead to the global energy giant we know today.

Meanwhile, back in the UK, the British government had taken a shine to BP’s prospects and became its principal shareholder in 1914. Winston Churchill first saw the future in the glistening pools of Anglo-Persian oil. In a passionate parliamentary plea, he urged his colleagues to embrace this new energy source and secure Britain’s interests in the vast “oil regions of the world.” Churchill’s gamble paid off, and the UK government became a major shareholder in Anglo-Persian, just in time for the looming World War I.

This cosy relationship lasted for decades until the government decided to cash in on its golden goose, selling off its shares and setting BP free to roam the global energy market in the late 1980s.

The dark side of BP

The 1920s and 30s were a boom time for Anglo-Persian, renamed Anglo-Iranian Oil Company (AIOC) in 1935. The company’s profits soared as the world embraced petroleum-powered cars and electricity. Its massive refinery near Abadan, Iran, became a symbol of industrial might, employing over 200,000 workers. But this prosperity had a dark side.

Iranian workers lived in squalor in “Paper City,” a shantytown plagued by disease and poverty, while British officials enjoyed air-conditioned offices and lavish villas. Even water fountains were segregated, a stark reminder of the unequal power dynamic. The disparity fueled resentment and laid the groundwork for future conflict.

World War II was the match that lit the fire, as the refinery continued to churn out fuel for the Allies, even as food shortages and a cholera epidemic ravaged the workforce. The situation in Abadan grew dire, with overflowing sewage and swarms of flies adding to the misery.

Nationalisation and the coup

Unsurprisingly, Iranian discontent with AIOC reached a boiling point. In 1951, the democratically elected Prime Minister Mohammed Mossadegh nationalised the company’s assets, triggering a global crisis. The UK and US retaliated with boycotts and sanctions, leading to a power struggle that ultimately culminated in a CIA-backed coup in 1953. Mossadegh was ousted, and the pro-Western Shah was restored to power, marking a turning point in Iran’s history and cementing BP’s controversial legacy in the region.

Rebranding and retrenchment: Dispelling legacy of colonialism

In 1954, in a bid to shed its colonial image, the company rebranded as British Petroleum. However, the damage was done. The coup and subsequent events left a bitter taste in the mouths of many Iranians, who viewed BP as a symbol of Western exploitation and interference.

The company’s troubles in the Middle East didn’t end there. The 1979 Iranian Revolution and nationalisation movements in other Arab states further curtailed BP’s influence in the region. By the early 1980s, BP’s oil production in the Middle East had dwindled to a fraction of its former glory, still serving as a stark reminder of the complex and often contentious relationship between oil, power, and politics.

BP Today: Beyond Petroleum, but still in the muck

While BP’s history is steeped in Middle Eastern intrigue and political turmoil, the company has undoubtedly evolved into a global energy giant with a vast network of operations. From offshore rigs in the North Sea and Papua to a dominant presence in the American market, BP has expanded its reach far beyond its Persian roots.

The company’s ambitious Prudhoe Bay project in Alaska, which involved constructing a massive 1,200 km pipeline, showcased BP’s engineering prowess and commitment to environmental protection. However, BP’s recent track record in North America has been marred by major incidents, including the deadly Texas City refinery explosion in 2005 and the massive Prudhoe Bay oil spill in 2006. Both incidents raised serious questions about the company’s safety practices and cost-cutting measures.

The devastating Deepwater Horizon spill in 2010 further tarnished BP’s reputation, casting a shadow over its claims of moving “beyond petroleum.” Despite its attempts to rebrand and make moves into renewable energy, the company remains deeply entrenched in fossil fuels, highlighting the ongoing challenges of transitioning to a more sustainable energy future.

Should You Buy BP Stock in 2024?

The question of whether to invest in BP in 2024 is a complex one with no easy answer. In general, this decision should be made only after careful research of a company’s financials and business model. We can’t tell you whether you should or should not do it, but we can weigh the pros and cons to help you make an informed decision.

Income Potential: BP is known for its generous dividends and share buybacks, making it an attractive option for income-oriented investors. The company’s recent commitment to maintaining its dividend despite lower profits shows confidence in its future prospects.
Growth Potential: While Q1 2024 earnings were disappointing, BP has demonstrated growth in oil and gas production and continues to invest in new projects, such as the Azeri Central East platform. A rebound in oil and gas prices could further boost the company’s profitability.
Transition to Renewable Energy: BP is investing heavily in renewable energy sources like wind and solar power, positioning itself for a potential shift away from fossil fuels. This diversification could mitigate some of the risks associated with the declining demand for oil and gas in the long term.

Reasons to Be Cautious:

Dependence on Fossil Fuels: BP’s core business relies heavily on fossil fuels, a sector facing increasing pressure due to climate change concerns and the growing popularity of renewable energy. This could pose a significant risk to the company’s long-term profitability.
Environmental and Social Concerns: BP’s history is marred by environmental disasters and social controversies, raising concerns about its commitment to sustainability and ethical practices. Investors increasingly prioritise ESG factors, and BP’s track record may deter some potential shareholders.
Recent Performance: BP’s recent financial performance has been lacklustre, with lower profits and missed earnings expectations. This raises questions about the company’s ability to adapt to changing market conditions and maintain its competitive edge.

If you’re seeking income and believe in the potential for a rebound in oil and gas prices, BP might be a worthwhile addition to your portfolio. However, if you’re concerned about the company’s environmental impact and long-term sustainability, you should explore other investment options.

Frequently Asked Questions

Is BP still a good stock to buy?

Whether BP is a good stock to buy depends on your individual investment goals and risk tolerance. BP’s recent financial performance has been a mixed bag, with fluctuating oil and gas prices impacting profitability.

Nevertheless, BP shares have shown resilience and strong performance, particularly with a significant rise of 154% since October 2021. The company’s ongoing transition towards becoming a net-zero energy company by 2050, combined with its investments in renewable energy and bioenergy, make it an attractive option for investors looking for both income and growth. For now, BP’s reliance on volatile oil and gas prices and the challenges of transitioning to green energy are factors to consider. As of now, market analysts have a mixed outlook, with some advising a “hold” position, indicating that investors should maintain their current holdings rather than buy more.

Can I buy BP shares in the UK?

Yes, you can easily buy BP shares in the UK. BP is listed on the London Stock Exchange (LSE) under the ticker symbol BP. You can purchase BP shares through various traditional stockbrokers or online investment platforms.

How much is the BP dividend per share in the UK?

BP’s dividend per share can vary. In 2023, BP paid a total dividend of 24.08 cents per share. It’s recommended to check the latest dividend information on BP’s investor relations website or financial news sources.

What is the stock price forecast for BP in 2025?

Stock price predictions are speculative and can vary widely depending on the source. Several factors, including oil and gas prices, global economic conditions, and BP’s renewable energy transition, will influence BP’s stock price in 2025. It’s essential to consult various analyst reports and financial forecasts to get a broader perspective on potential price movements.