Shell Plc is working with advisers to assess the possibility of acquiring rival BP Plc, according to Bloomberg News.
Sources familiar with the matter said Shell is monitoring both BP’s share price and global oil market trends, and may wait for further declines before deciding whether to move forward with a bid. Discussions with advisers around the feasibility and strategic benefits of such a takeover have intensified in recent weeks.
Although Shell and BP were similar in size for many years, Shell has significantly pulled ahead, now boasting a market capitalization of approximately £149 billion—almost double that of BP.
When asked over the weekend about the possibility of acquiring BP, Shell CEO Wael Sawan told the Financial Times he preferred expanding share buybacks instead. A Shell spokesperson later confirmed those comments to Reuters.
During a recent earnings call, Sawan added that Shell must first “have our own house in order” before pursuing major acquisitions, despite progress made in recent years.
A takeover of BP would position Shell as a dominant player in the global energy sector, enhancing its scale to compete more directly with U.S. giants ExxonMobil and Chevron. However, such a deal would likely attract significant regulatory scrutiny due to its magnitude.
Shell recently posted better-than-expected first-quarter earnings and announced a $3.5 billion share repurchase program. According to Bloomberg, Shell could also be preparing for a scenario in which BP initiates discussions or another bidder emerges.