BP: Russia sanctions will hit UK economy

BP: Russia sanctions will hit UK economy

Oil giant BP has warned that further international sanctions on Russia could have a “material adverse impact” on the company.

The UK business owns a 19.75% stake in Russian oil firm Rosneft, which is the subject of sanctions preventing it from using US financial institutions for new loans over a period longer than 90 days.

In its second-quarter results, BP said further international sanctions on Rosneft or on Russia could have a “material adverse impact” on its investment in Rosneft, its business in Russia and its own financial position.

Profits for the quarter to June 30 were US $3.18bn US dollars (€2.37bn), up by a third on the same period a year earlier but down 8% on the previous quarter.

Production was 3% higher on an underlying basis but BP warned that output in the current quarter is expected to be lower, primarily due to planned maintenance activities in Alaska and the Gulf of Mexico.

The investment in Rosneft, which is Russia’s biggest oil producer, was a factor in the improved performance by BP as profits from the relationship nearly doubled to just over $1bn (€744m) in the second quarter.

BP shares opened just under 1% higher today.

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