Oil & Gas Aramco explores potential bid for BP’s Castrol unit By Reuters March 6, 2025, 10:38 AM Aramco Saudi Aramco reported a drop in its 2024 profit and signalled it will slash its dividend payouts by nearly a third this year Saudi Aramco is in the early stages of considering a potential bid for BP’s lubricant business Castrol, according to a person with knowledge of the matter. BP has been exploring all options around its Castrol business, including a possible sale, as part of a strategic review. The business would be expected to be worth around $6 billion to $8 billion, Ashley Kelty, an analyst at Panmure Liberum, said in a note last week. BP and Aramco declined to comment. Bloomberg News was first to report about Aramco’s interest in Castrol on Wednesday, which comes a day after the Saudi oil giant reported a drop in its 2024 profit and signalled it will slash its dividend payouts by nearly a third this year. BP said last week it was reviewing its lubricants business, Castrol, and targeting $20 billion in divestments by 2027. The divestment programme is a key part of CEO Murray Auchincloss’ strategy to slash spending on renewables and increase BP’s focus on oil and gas production to enhance earnings. BP to develop Iraq oil fields at potential cost of $25bn BP could be a savvy investment for Gulf buyers Adnoc’s acquisition strategy could lead to something major BP, which has underperformed peers like Shell and Exxon, has come under increasing pressure to change strategy after news that US activist investor Elliott Investment Management has built a 5 percent stake in the company. According to Elliott, BP would benefit from selling its Castrol lubricants and its network of service stations to unlock value and boost share buybacks, a source told Reuters last week. Bloomberg’s report said Aramco hasn’t made a final decision on the structure of a potential bid for Castrol or whether it will proceed as deliberations are still in the early stage.
