If investors want to know what to expect from BP PLC (LSE:BP.) (BP PLC (LSE:BP.)) on Tuesday – they should probably look at Shell’s numbers from last week.
Like Shell, BP is expected to show a substantial upturn in profits mostly thanks to higher oil prices.
As Brent and WTI crude prices have remained above US$90 dollars the spotlight remains on oil supermajors like BP, and, what their burgeoning profits and cashflow means for the ‘energy transition’ narrative communicated to stakeholders last year.
The market is expected BP will reveal a sixfold increase in net income is predicted by the market for the fourth quarter, up from just US$968mln in the same period a year ago whilst the price of crude languished.
With all that cash sloshing around investors will closely eyeball returns, whether that’s dividends or buybacks.
They’ll want to an update on the company’s much talked about transition and ‘net zero’ goals.
From the outside of the company no doubt there’ll be more noise among those calling for windfall taxes.
Dani Hewson, analyst at stockbroker AJ Bell, in a note this week highlighted: “with BP just days away from its trading update questions about whether a windfall tax is a viable solution to the current energy crisis will hang around,” Hewson added.
“Of course, it’s not a straightforward argument, both businesses have a duty to their shareholders, the people who bankroll their operations in good times and in bad.”