It’s been a great 12 months for BP (LSE:BP) share price. The FTSE100 the oil and gas giant grew by 50% in that time, most notably dividends. This is much better than I imagined when I bought the stock a few years ago. At the time, I wasn’t entirely convinced by the investment case.

I was concerned about the awkward transition away from (and back to) fossil fuels and the impact of the climate debate. But I was also attracted by the dividend, which at the time was over 6%, and the low valuation. So what will next year bring?

It’s difficult to look beyond the war with Iran at this point. This is dominating headlines and investor sentiment towards BP. When Donald Trump announced the opening of the crucial Strait of Hormuz on Friday (April 17), markets soared, but BP shares moved the other way along with the price of oil.

Could it crash the FTSE 100 again?

In the miniature term, BP looks like a clear bet on the turmoil in the Middle East. Whenever the price of oil rises, oil stocks follow it. When a solution seems possible and the price of oil falls, BP’s stock falls, too.

With Hormuz apparently closed again, BP is rising today (April 20). This could reverse at any moment. So how can investors make sound decisions at a time like this?

I’m always wary of analyst forecasts, but I was curious to see what they would say about this stock. Currently, 28 brokers offer annual forecasts, with a consensus target of 604p. That’s an augment of a modest 8% on today’s 559p. Add a projected 2026 yield of 4.7% and the total return is 12.7%. This would turn £10,000 into £11,270. Which is totally respectable, but not as stimulating as the last 12 months.

The forecast is uncertain at the best of times. Some of these estimates may be collecting dust and perhaps even predate the conflict in Iran. There are also a variety of different results available, with the lowest estimate being 382p and the highest estimate being 777p. At today’s price of around 559p, the latter would represent an augment of 39%. This could happen. Honestly, anything can happen now.

Is it too risky to buy BP right now?

During periods of extreme short-term volatility, it is often useful to look further into the future, say five to ten years. With any luck, the Iran conflict will be over long ago, although nothing is certain. If the planet warms, political pressure on fossil fuel producers could intensify. Renewable energy sources have also been able to expand significantly. Both will pose a threat to BP.

However, recent events highlight how critical oil is to the global economy. Even if demand for fuels declines, they will still be needed for plastics, pharmaceuticals, raw materials and fertilizers, although not to the same extent.

With a forward price-to-earnings ratio of around 9, BP looks like a good value despite its robust run. But it’s not without risk. I think this is worth considering as part of a balanced portfolio and I will definitely keep it. However, I see a much less bumpy income and growth opportunity in the FTSE 100 today and will take advantage of it in future purchases.