Phosphorus (P) is an essential nutrient for crops and is applied to agricultural soil to bring or keep the soil at a certain target soil P status in view of an optimal crop yield. Environmental objectives, however, are rarely considered in current P fertilizer recommendations. In this review paper, we argue that current P fertilizer recommendations must be revised in order to balance crop yield, water quality and the use of finite P resources. This revision requires insights into the total pool of reversibly bound P and the capacity of the soil to bind P. Current soil P tests (SPTs) used in routine agronomic soil testing do not provide these insights. We identify the oxalate extraction method as a high-potential agri-environmental SPT as it measures the total pool of reversibly bound P acting as a reserve for plant-available P while it also quantifies the maximum soil P sorption capacity from the simultaneous measurement of amorphous iron- and aluminium-(hydr)oxides. From these results, the Phosphorus Saturation Degree (PSD) can be calculated. We show that those insights are pivotal for the combined assessment of crop response, the risk of P losses to the water system and the judicious use of finite P reserves. In practice, agronomic target P levels should be lowered in soils with a low P sorption capacity to decrease the risk of P leaching. Agronomic target levels should also be lowered in soils with a high P sorption capacity to ensure a judicious use of finite P reserves.