Over the past year, BP plc BP has jumped 45.2%, outpacing the industry’s 39.8% growth. It also outperformed Exxon Mobil Corporation’s XOM 43.8% and Chevron Corporation’s CVX 33.3% increases, respectively.
One-Year Price Chart
Zacks Investment Research
Image Source: Zacks Investment Research
This reflects investors’ strong preferences for the stock, backed by its solid upstream and refining operations. Should investors bet on the British energy giant right away? To conclude on this, let’s first analyze BP’s business fundamentals.
BP’s Upstream Business Outlook Looks Promising
The price of West Texas Intermediate (“WTI”) crude is hovering around the $90-per-barrel mark. The high price is being backed by ongoing tensions in the Middle East. The U.S. Energy Information Administration (“EIA”) in its latest short-term energy outlook projected WTI at $85.68 per barrel this year, higher than $65.40 last year. A highly favorable pricing environment for the commodity is likely to continue supporting BP’s exploration and production activities, which derive a significant proportion of its earnings, similar to ExxonMobil and Chevron.
The U.S. Energy Information Administration
Image Source: The U.S. Energy Information Administration
The British energy major’s production outlook seems bright, thanks to major discoveries. On its latest earnings call, BP mentioned that since the beginning of 2025, it has made 14 discoveries. BP said Bumerangue appears to be a very large oil discovery, estimated at around 8 billion barrels in place, though further appraisal work is needed to determine how much can actually be extracted and commercialized.
BP’s Refining Output Adjustment Seems Encouraging
Unlike many refiners, BP is making adjustments in its refinery output to produce the right kind of fuels that are most in demand now. The British energy giant is trying to capture the demand for jet fuel and diesel that are in short supply. Thus, by adjusting the mix of products from its refineries, BP is likely to generate handsome cash flows for its shareholders.
BP already experienced a solid refining business in the March quarter. With a throughput of more than 1.5 million barrels per day, the integrated major touched the mark of the highest quarterly figure in four years.
Is BP Stock a Must Buy Now?
All the positive developments are getting reflected in the price surge of the stock, which we have already noticed in the one-year price chart. Despite the price improvement, BP stock is currently undervalued. The company is trading at a trailing 12-month EV/EBITDA multiple of 3.19x, which is lower than the broader industry average of 6.30x. ExxonMobil and Chevron, two other integrated energy majors, are valued higher at 9.89x and 9.65x, respectively.