BP (BP) announced on Tuesday that it probably reached its debt reduction target in the first quarter, helped by asset sales and a rebound in oil prices. BP’s shares soared.
X
The largest in European oil was previously forecast to reach its goal of $ 35 billion in net debt between the fourth quarter of 2021 and the first quarter of 2022.
“This is the result of an early delivery of divestiture revenues combined with very strong business performance during the first quarter,” said CEO Bernard Looney in a statement.
BP received $ 4.7 billion in revenue from asset sales during the first quarter. Sales included an interest in a large gas field in Oman and an interest in Palantir (PLTR).
With its debt target likely in hand, BP could resume stock repurchases soon. The company reiterated its promise to deliver 60% of the excess cash to shareholders.
Last year, BP and other big oil companies like Exxon Mobil (XOM), Chevron (CVX) and Royal Dutch Shell (RDSA) suspended repurchases because oil prices plummeted during the pandemic.
BP will present the full results for the first quarter and provide further updates on the repurchase program on April 27. The company also cut its dividends last year, but did not mention that on Tuesday.
IBD Live: a new tool for daily stock market analysis
BP Stock, Oil Stock
The shares rose 2.5% to 24.85 in the stock market today. BP’s shares have cooled since mid-March, but are now recovering from a test on its 50-day line, according to analysis by the MarketSmith chart.
Other major oil stocks fell on Tuesday. Exxon’s shares fell 0.2%, Chevron lost 0.8% and Shell ceded 0.5%.
Meanwhile, US and Brent crude oil prices rebounded more than 1% after liquidation on Monday, with the resurgence of ambitious cases in major markets adding to fears of demand.
ConocoPhillips (COP), the largest independent oil producer, resumed its share repurchases last month, while also keeping investment plans in check.
The resumption of BP’s share buybacks could put more pressure on American rivals to do the same soon. But Chevron told shareholders last month that repurchases would not resume until management is confident they can be sustained for several years.
Follow Gillian Rich on Twitter for energy news and more.
YOU MAY BE INTERESTED IN:
Get the latest news on BP shares, other oil stocks and the energy industry
Main oil stocks to be observed in the US shale as the new No. 1 emerges in the Permian basin
The IBD / TIPP survey gives these three Covid vaccine stocks reasons for
Option trading: how to start using options, how to manage risk