BP’s Earnings Outlook Got A Lift From Higher Brent Forecasts

BP has halted production and evacuated personnel from several Gulf of Mexico platforms, including Na Kika and Thunder Horse, due to Hurricane Isaias. Other companies, such as Shell, Chevron, and Harbour Energy, have also taken similar measures. The Marine Minerals Administration reported 1.28 million barrels per day of offshore oil output shut in as of Thursday, up from 511,600 barrels the previous day.

Shell, Chevron, and Harbour Energy are reducing Gulf of Mexico oil production and evacuating personnel due to Hurricane Isaias. By Wednesday, 25% of Gulf oil output (511,619 barrels/day) and 16% of gas production were offline. Isaias, the first 2026 Atlantic hurricane, is expected to hit the northern Gulf Coast. Oil prices rose Thursday, with Brent crude up 5% to $105.23/barrel and WTI at $92.70/barrel.

JP Morgan recommends holding above-benchmark positions in Shell (SHEL) and BP (BP) due to strong sector fundamentals, including high free cash flow yields and refining margins. The bank expects robust third-quarter earnings but cautions about potential softening in refining margins. It favors Galp (GALP) and Eni (E) in the midcap space, while being underweight on OMV (OMV). European energy policy, including windfall taxes, is noted as a risk.

Oil prices rose on Thursday due to Middle East shipping attacks and U.S. Gulf Coast disruptions. Brent crude climbed 3.9% to $104.07, WTI increased 3.7% to $91.53. Iran's attacks on tankers in the Strait of Hormuz and U.S. Gulf Coast weather disruptions contributed to the surge. Major oil companies like BP, Chevron, and Shell may face production disruptions. U.S. crude inventories fell 3.2 million barrels last week, defying expectations.

An investigation found BP missed opportunities to prevent the deaths of two brothers at its Ohio refinery. The report, by the U.S. Chemical Safety Board, cited safety lapses. BP has not yet publicly responded to the findings.

Mizuho raised BP's (NYSE:BP) price target to $56, citing strong European gas and refining margins. It increased its Q3 earnings estimate to $1.97 per ADS. BP's stock is up 33.7% YTD. Multiple analysts upgraded BP, citing debt reduction and favorable commodity conditions. BP's trading statement is expected October 1.