BP upbeat after profits rise

BP upbeat after profits rise

Oil giant BP sparked a big jump in its share price today after quarterly profits of $4.2bn (€3.2bn) smashed City expectations.

The haul for the first three months of the year was 9% higher than the previous quarter but down 9% on the same period a year earlier.

Despite a 5% year-on-year decline in production caused by a raft of disposals since the Gulf of Mexico disaster in 2010, the figure was much better than analysts’ forecasts for $3.3bn (€2.5bn). Shares rose 4% to around 473p today.

Chief executive Bob Dudley described the results as strong and said they demonstrated the progress being made in rejuvenating the business.

It comes after an 18% plunge in 2012 profits to $17.6bn (€13.5bn) as the cumulative cost of the Deepwater Horizon disaster reached $42.2bn (€32.3bn).

However, the company gave a boost to shareholders last month by completing the sale of its 50% stake in TNK-BP to Russia’s Rosneft for $12.48bn (€9.55bn) in cash and Rosneft shares.

The company now holds 19.75% of Rosneft, which has become the world’s biggest publicly traded oil company.

It triggered the return of £5.3bn (€6.2bn) for shareholders as part of an immediate return from the reshaping of the Russian business.

Following the Rosneft transaction, BP said its total oil and gas production was three million barrels of oil equivalent a day.

However, output in the second quarter is expected to be lower as a result of planned seasonal activity at higher-margin assets in the Gulf of Mexico and the North Sea, as well as the ongoing impact of disposals.

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