BP (BP) Stock Forecast & Price Target

BP is supported by a clear deleveraging path, with net debt cut by about $7B in 2Q and another $12.5-14.5B expected in 2H26 from internally generated cash, ~$7.5B of asset sales, and a $2-3B working-capital unwind. That progress is reinforced by strong operating cash generation from 2025 production of 1.2 million barrels of liquids and 6.5 billion cubic feet of natural gas per day, plus 1.56 million barrels per day of refining capacity and a downstream setup that should benefit from high refining crack spreads and trading profits in 2026. With proved reserves of 6.2 billion barrels of oil equivalent, 56% liquids, and a valuation discount versus European peers, the company appears positioned to strengthen its balance sheet, narrow the gap over time, and eventually support a more balanced capital return framework.

BP is trading near its 3-year historical EV/EBITDA multiple of about 3.5x, but that still appears to reflect a valuation discount versus European peers closer to 4x, suggesting the market is already pricing in meaningful operational and financial risk. The company’s upstream scale remains sizable, with 2025 production of 1.2 million barrels of liquids and 6.5 billion cubic feet of natural gas per day, yet its 6.2 billion barrels of oil equivalent of proved reserves and 56% liquids mix do not fully offset concerns about durability, reinvestment needs, and commodity exposure. The negative view is also reinforced by higher balance sheet leverage, which can constrain flexibility and help explain why BP continues to trade below peer valuation despite its integrated asset base and 1.56 million barrels per day of refining capacity.