BP quarterly profit rises on stronger refining margins amid Middle East disruption
BP reported third-quarter underlying replacement cost profit of $8.46bn, up from $2.2bn a year earlier and above analysts’ $7.33bn forecast. The company said higher refining margins and stronger gas and marketing trading drove the increase, as conflict in the Middle East disrupted energy supplies and trade routes.
Fuel prices, including diesel, have reached record levels in the UK, Europe and the US, despite global oil prices remaining below their 2022 peaks. BP said it would use excess cash flow to cover its remaining Deepwater Horizon liabilities, which stood at $5.94bn; its first major strategy update under chief executive Meg O’Neill is expected on 15 December.
In short
- BP’s quarterly profit rose to $8.46bn.
- Refining margins and trading boosted earnings.
- BP plans to address $5.94bn in spill liabilities.
Steelman: both sides, in good faith
The strongest fair case each way — we don't pick a winner.
The case for
BP’s results show it is benefiting from stronger refining margins and trading at a time when disruption is making energy supplies and transport less reliable. Supporters may argue that higher profits strengthen the company’s capacity to meet its remaining Deepwater Horizon liabilities and invest in energy supply, while its forthcoming strategy update offers a chance to set out how it will use the cash.
The case against
The results also underline how energy companies can earn substantially more while households and businesses face record fuel prices, even when global oil prices remain below their 2022 peaks. Critics may argue that using excess cash flow to cover liabilities the company already owes does not by itself address affordability or wider public concerns about its role in a disrupted energy market.
Explained simply
BP is one of the world’s largest energy companies. It produces and sells oil and gas, and also refines crude oil into products such as petrol and diesel. Its “underlying replacement cost profit” is a measure BP uses to show how its business performed, excluding some items that can make results fluctuate.
Refining margins are the difference between the cost of crude oil and the price of the fuels made from it. Disruptions to energy supplies and shipping routes can affect those costs and prices, while also influencing trading in gas and fuel. BP is also still paying liabilities linked to the 2010 Deepwater Horizon oil spill in the Gulf of Mexico.
Art Business Companies Culture Middle East World
Read the full article at the source →
Originally published by The Guardian as “BP profits jump as Middle East conflict drives up oil refining margins”.