- Summary:
- BP share price has risen by more than 7 percent year-to-date, but key geopolitical factors and demand outlook could reset the tone.
BP share price has endured a torrid run in the last year, with reduced demand for oil outweighing the geopolitical pressure that came with the Russia-Ukraine war and the Middle East conflict pitting Israel on one side against Hamas, Hezbollah, Houthi rebels and Iran on the other.
BP Share Price Risk vs Reward Outlook
Despite global crude oil prices rising by about two percent in the last year, BP share price declined by more than seven percent. The deviation is compounded by the apparent unresponsiveness of the market to the company’s $14 billion share buyback program.
However, BP share price is off to a good start in 2025 and has gained 7.4 percent year-to-date. The upbeat momentum is supported by rising oil prices, with benchmark Brent crude prices up by 2.2 percent and WTI up by 2.5 percent YTD.
BP signed a landmark deal with the Iraqi government in mid-2024 for the exploration of oil in the Kirkuk oil fields. The deal gives BP access to approximately 9 billion barrels of oil, whose exploration cost is estimated at under $2 per barrel.
There is a valid concern that Donald Trump’s presidency could add pressure on oil prices. Trump’s liberal approach to the oil industry is a near-opposite to Joe Biden’s, and could lead to an oversupply of the commodity. Also, concerns over China’s economy will continue to subdue oil price upside, hence impacting BP share price.
BP Share Price Prediction
BP share price pivots at GBX 422.15 and the upside will prevail if the price action stays above that level. Immediate resistance is likely to come at GBX 425.85 However, an extended hold by the buyers could break above that level and test GBX 427.80
Conversely, the sellers will take control if the stock moves below GBX 422.15. That could see initial support come at GBX 419.75. The upside narrative will be invalid if it break below that level, and the resulting momentum could extend the decline to test GBX 416.80.
