BP Sells 65% Stake in Castrol Lubricants for $8 Billion
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Dec 24 2025
0mins
Should l Buy BP?
Source: Yahoo Finance
- Transaction Overview: BP sells a 65% stake in its Castrol lubricants business for $8 billion, which, while falling short of a full 100% sale, aligns with market expectations and indicates positive progress in the company's strategic reset.
- Financial Impact: The deal will provide BP with funds to reduce debt, although analysts express concerns about the long-term sustainability of dividends and earnings quality, suggesting that cutting buybacks would have been a better option.
- Market Reaction: BP's shares rose 0.1% to £4.28 following the announcement, reflecting an 8.8% increase year-to-date, indicating investor satisfaction with the sale price.
- Strategic Outlook: Under the leadership of newly appointed CEO Meg O'Neill and Chair Albert Manifold, a strategic review is expected in February, with investors hopeful for more radical changes compared to previous leadership.
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Analyst Views on BP
Wall Street analysts forecast BP stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for BP is 84.26 USD with a low forecast of 6.38 USD and a high forecast of 503.69 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
11 Analyst Rating
5 Buy
5 Hold
1 Sell
Moderate Buy
Current: 39.200
Low
6.38
Averages
84.26
High
503.69
Current: 39.200
Low
6.38
Averages
84.26
High
503.69
About BP
BP p.l.c. is a United Kingdom-based integrated energy company. The Company's segments include Gas & low carbon energy, Oil production & operations, Customers & products, and Other businesses & corporate. Its gas business includes regions with upstream activities that produce natural gas, integrated gas and power, and gas trading. Its low carbon business includes solar, offshore and onshore wind, hydrogen and carbon capture and storage and power trading. Oil production & operations segment comprises regions with upstream activities that predominantly produce crude oil, including bpx energy. Customers & products segment comprises its customer-focused businesses, which include convenience and retail fuels, electric vehicle charging, as well as Castrol, aviation and business to business and midstream. It also includes its products businesses, refining and oil trading, as well as its bioenergy businesses. Other businesses & corporate segment comprises technology and bp ventures.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Middle East Strategy: The Middle East is one of BP's top-producing regions; in addition to Kirkuk, BP operates Iraq's largest oil field, Rumaila, in the south, further solidifying BP's market position in the region.
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- Cost Control Targets: Shell raised its cost reduction target from $2-3 billion to $5-7 billion by 2028 and lowered its capital expenditure target from $22-25 billion to $20-22 billion, indicating a strong focus on maintaining financial health in a volatile market.
- Investment Enthusiasm in Nigeria: Shell's investments in Nigeria have reached $5 billion, including the Bonga North deepwater project and HI gas field, reflecting a strategic pivot towards the region that could enhance its global energy market position.
See More
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- Shareholder Pressure: A coalition of shareholder activists and pension funds is pressuring BP to justify its shift in investment from renewable energy to oil and gas projects, a move that fails to address the underlying causes of the company's poor performance.
- Proposal Context: The shareholder resolution, co-filed by U.K. and European pension funds along with the Australasian Centre for Corporate Responsibility, represents 0.42% of BP's share capital valued at over $400 million, indicating strong investor concern over the company's strategic direction.
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- Profit Trend Changes: In 2022, the five largest Western oil companies reported nearly $200 billion in combined profits, but the current profit pressures starkly contrast with the “monster profits” seen a few years ago, highlighting the industry's volatile cycles.
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