Execution RiskBP's strategy is facing increasing execution risk due to a lower oil price outlook, which may force the company to choose between reducing leverage or suspending buybacks and upstream growth ambitions.
Leverage ConcernsBP has the highest leverage in the sector, and current macro conditions put its plan to reduce net debt at risk, potentially leading to suspended buybacks.
Valuation And PerformanceBP's valuation isn't cheap, with NTM earnings estimates falling more than the sector, leading to a higher relative PE re-rating compared to its peers.