Oil giant BP posted a lower-than-expected 12 per cent drop in fourth-quarter profit today as production fell and taxes rose.
The company said its fourth-quarter replacement cost net profit, which strips out changes in the value of inventories, was $3.895 billion. Full-year profit was up 15 per cent at $22.3 billion.
But BP's shares fell as investors focused on new production targets which fell far short of earlier growth plans.
BP shares traded down 1.3 per cent at 534.5 pence earlier this morning, compared to a 1.6 per cent drop in the DJ Stoxx European oil and gas sector index.
BP forecast production in 2007 would fall to 3.8 to 3.9 million barrels of oil equivalent per day (boepd), from 3.93 million boepd in 2006. The 2006 result was down 2 per cent on 2005.
Investors had expected BP to return to growth in 2007.
London-based BP also scaled back growth plans to the end of the decade, predicting 2009 production of four million boepd, well below earlier growth plans of 4 per cent per annum to 2010.