BP Plc has cemented its status as problem child among the world’s top oil companies with unexpectedly weak quarterly results, slashing $5 billion (€4.1 billion) off the value of its US assets and undershooting forecasts at operating level.
The British oil company, struggling under the weight of litigation over the 2010 US Gulf oil spill and a row with its Russian partners, said both oil production and refining margins fell in the second quarter and would fall again in the third.
BP shares at one point were down 4.5 per cent yesterday.
The $5 billion cut included $2.7 billion for the declining value of US refineries and a $2.1 billion two-part writedown of US shale gas assets, which have been hit by a slump in prices, and to take account of suspension of the Liberty offshore project in Alaska. BP abandoned Liberty earlier in July, saying it looked likely to cost more than the $1.5 billion it had planned to spend there.
BP also booked an extra $847 million provision for the 2010 US Gulf oil spill, bringing the total set aside for the disaster to $38 billion, or well over two years worth of profits at current prices. – (Reuters)
