We forecast BP's revised cash allocation strategy will not result in meaningful further debt reduction. We now project funds from operations (FFO) to debt to remain at 50%-55% in our base case and below 45% at our midcycle Brent oil price assumption of $55 per barrel of oil equivalent (/boe). We therefore revised our outlook on BP to stable from positive and affirmed the 'A-' long-term and 'A-2' short-term issuer credit ratings. The stable outlook reflects our expectation of modest discretionary cash flow (DCF), even with currently supportive market conditions and FFO to debt of 50%-55% in 2024-2025. Importantly, in a more midcycle scenario with assumed long-term oil price of $55/boe, BP's metrics would be markedly weaker with FFO to
