Britain’s BP has agreed to sell a 65% shareholding in lubricants business Castrol to Stonepeak for $6 billion, months on from the oil giant seeking a buyer for the unit.
The deal comes as the company looks to launch a strategic reset, including a green strategy U-turn and the divestment of $20 billion of assets by the end of 2027. The sale values Castrol at $10.1 billion.
Energy companies, including India’s Reliance Industries and Saudi Arabia’s oil behemoth Aramco, as well as private equity firms Apollo Global Management and Lone Star Funds, had all been touted as suitors for BP’s Castrol unit in May, according to Bloomberg, citing people familiar with the matter.
“With this, we have now completed or announced over half of our targeted $20bn divestment programme, with proceeds to significantly strengthen bp’s balance sheet,” interim CEO Carol Howle said in a statement.
“The sale marks an important milestone in the ongoing delivery of our reset strategy. We are reducing complexity, focusing the downstream on our leading integrated businesses, and accelerating delivery of our plan.”
BP has the option to sell its remaining 35% stake in Castrol after a two-year lock-up period.
Strategy reset
The Castrol majority stake sale comes days on from the oil giant announcing it was appointing a new CEO — it’s fourth in six years.
Woodside Energy boss Meg O’Neill will take up the role on April 1, replacing Murray Auchincloss, who lasted less than two years in the role.
Stephen Isaacs, strategic advisor at Alvine Capital, which holds a position in BP, told CNBC’s “Squawk Box Europe” last week that while BP has been “a very poor performer for a long, long time,” the CEO change could be “the last piece of the jigsaw” in getting its house in order.
“I think there’ll be further stake sales of different parts of BP” going forward, Dan Boardman-Weston, CEO at BRI Wealth Management, told CNBC on Wednesday. The shift will see the company “getting back to their bread and butter of focusing on oil and gas exploration and development.”
The London-listed company has underperformed compared with its peers in recent times, having reported declining annual profits in both 2023 and 2024.
BP’s shares opened at 1.3% on Wednesday before paring gains slightly to last trade 0.9% higher. Its share price is up around 9% so far this year, following a 15.7% drop in 2024. Pressure on the stock eased in 2025 following a leadership shakeup, a cost-cutting program, and a string of oil discoveries.
Read More: BP to sell 65% stake in $10 billion Castrol Lubricants to Stonepeak
