Business | Oil & Gas
Channel Sponsor
BP posts record third-quarter profit
British oil major BP Plc may have marked the oil industry's high point by reporting a record $10 billion third quarter replacement cost profit on Tuesday, as the recent collapse in crude prices ensures a tougher outlook.
- Reuters
- Published: 23:31 October 28, 2008
London: British oil major BP Plc may have marked the oil industry's high point by reporting a record $10 billion third quarter replacement cost profit on Tuesday, as the recent collapse in crude prices ensures a tougher outlook.
Europe's second-largest non-government control-led oil company by market value said the forecast-beating earnings showed a turnaround under Chief Executive Tony Hayward was delivering results.
BP shares were up 2.11 per cent at 447.75 pence, retreating from opening highs at around 472 pence but still outperforming the DJ Stoxx European oil and gas sector index at 0858 GMT.
"They are particularly impressive results," said Jason Kenney, oil analyst at ING in Edinburgh. "We will just have to see how long the oil price stays low or lower."
BP added that, even though oil prices may fall further, it remained committed to growing dividends. Investors had feared these could come under pressure after crude fell from a record above $147 a barrel in July to around $64 now.
"We think the current turmoil may in fact create opportunities for us and we will look at those very closely," Hayward said in a statement.
A spokesman said this could include acquisitions of rivals or oil and gas fields.
As usual the main driver of earnings was BP's upstream oil and gas production unit, which benefited from a 54 per cent rise in the Brent crude price to an average $115.09 a barrel in the third quarter, compared to the same period in 2007.
The London-based company said oil and gas production rose slightly in the quarter compared to a year earlier, to 3.664 million barrels of oil equivalent per day, while analysts had expected a small drop.
A spokesman said the production result was due to a good performance at its Thunder Horse platform in the Gulf of Mexico. "The well performance is amazing there," he said.
BP said that adjusting for the impact of production-sharing agreements, under which BP's oil entitlement falls as prices rise, production rose 5 per cent.
Share this article
Popular in Business
-
Budget travel
Airlines in the region
Take a pictorial look at some of the budget airlines in GCC
Business Editor's choice
-
Media baron Murdoch cries foul
Murdoch's suggestion of content theft infuriates digital evangelists
-
Jobs vital to global recovery
Higher unemployment reduces purchasing power and revenues
-
Abulhoul Aviation to begin operations
New charter company will use Cessna 206 Station Air to transport tourists
