BP production hit by hurricane

Energy giant BP today reported a fall in third quarter production after operations in the Gulf of Mexico bore the brunt of Hurricane Ivan.

Overall BP production for the three months to September 30 is forecast to come in at 3.88 million barrels of oil and gas a day, a fall of 2% on the previous three months but still up by 11% on a year earlier.

As well as the disruption caused by last month’s hurricane, BP said planned maintenance in the North Sea and Alaska and a blow-out at partner-operated Tesmah in Egypt put pressure on its higher margin operations.

Despite the quarterly fall, BP said average production across 2004 was still expected to be 10% higher than 2003.

Analysts are forecasting profits of 16 billion (£9bn) this year – the highest figure ever recorded by a UK company – as BP benefits from sky-high oil prices.

In today’s update, BP said its exploration and production division saw the average cost of a barrel of Brent crude rise to 41.54 US dollars in the third quarter, up from 35.32 US dollars in the previous quarter.

In the customer-facing business, BP said margins suffered because increases in selling prices had failed to keep up with rising input costs.

BP will provide more details on its third quarter performance on October 26.