BP profits fall as Gulf spill costs leap in second quarter

Suzie Neuwirth

OIL GIANT BP today posted a 25 per cent fall in second-quarter profits to $2.7bn (£1.8bn) year-on-year, due to lower oil prices and higher taxes.

The firm also said that provisions for compensation claims relating to the Gulf of Mexico disaster had increased by $1.4bn over the second quarter, bringing total claims costs to $19.7bn and edging close to exceeding BP’s $20bn oil spill trust fund.

“The results show strong underlying pre-tax performance from BP's businesses,” said chief executive Bob Dudley.

“We are seeing growth in production from new high-margin projects and are making good progress in exploration and project delivery. Completion of our operational milestones confirms our confidence in delivering our commitment to materially increase operating cash flow in 2014.”