How the Iran war boosted profits at BP and Barclays
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Barclays' profits rose, but loan losses weighed on its first-quarter results. At the same time, oil giant BP’s earnings jumped, largely driven by an exceptional oil trading boom linked to the Iran war.
British multinational oil and gas company BP’s first-quarter results were boosted by sharp swings in oil prices during the Iran war, which began on 28 February 2026.
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The company said that underlying replacement cost profit more than doubled to $3.2 billion (€2.7bn) in the first three months of 2026.
“Underlying RC profit for the quarter was $3.2 billion, compared with $1.5 billion for the previous quarter,” the company said in a statement, adding that “compared with the fourth quarter of 2025, the underlying result reflects an exceptional oil trading contribution and stronger midstream performance.”
BP's oil trading operation posted strong profits as energy market turmoil intensified during the Iran war.
Brent crude prices rose from just above $70 per barrel in early February to over $120 per barrel in late March, before settling at around $110 per barrel in April.
Oil production and operations remained steady compared with the previous quarter, with upstream production resilient at around 2.3 million barrels of oil equivalent per day.
The company also highlighted its exposure to the Middle East, with approximately 411,000 barrels of oil equivalent per day of upstream production in the region. This includes operations in Abu Dhabi, Oman and Iraq.
BP’s share price was up by more than 2% in afternoon trading in Europe.
RelatedBarclays earnings up as trading offsets loan losses
At the same time, British bank Barclays reported steady first-quarter growth, as trading volatility linked to the Iran war boosted income, though concerns over its loan portfolio weighed on sentiment.
Shares fell around 2% by early afternoon trading in Europe.
Total income rose 6% to £8.2bn (€9.5bn), while profit before tax increased to £2.8bn (€3.2bn), up from £2.7bn (€3.1bn) a year earlier.
However, its key profitability metric — return on tangible equity (RoTE) — slipped to 13.5%, from 14.0% last year.
Rising loan losses offset some of the strong performance. Barclays booked a £228m (€264m) charge linked to the collapse of UK mortgage lender Market Financial Solutions (MFS).
Chief executive C.S. Venkatakrishnan said the bank would scale back complex lending and reduce exposure to highly leveraged companies following the hit from MFS.
In a statement, he said growth was driven by broad-based performance across the business, highlighting the strength of the investment bank. Income there exceeded £4bn (€4.6bn) for the first time in a quarter, supported by strong trading and advisory activity.
Will Howlett, financial analyst at Quilter Cheviot, said the performance was driven by equities trading amid heightened volatility since the onset of the Iran war. He noted this led to growth of 16% year on year, or 23% in US dollar terms, alongside a 17% rise in investment banking fees.
Barclays also announced a £500m (€580m) share buyback, bringing total buybacks this year to £1.5bn (€1.74bn). The bank reiterated its financial targets, citing a strong and supportive capital position.
Russ Mould, investment director at AJ Bell, described the quarter as “another bumper performance” for Barclays’ investment bank, potentially marking its strongest quarterly profit this decade.
However, he added that investors are now assessing whether recent loan losses were isolated or point to weaker lending standards.
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