OIL giant BP yesterday said that second quarter profits had slumped by more than half as it continued to suffer from falling energy demand and a weak oil price. <br /><br />According to the replacement cost profit measure – which strips out gains or losses related to any changes in the value of its fuel stocks – the firm’s profits fell to $3.14bn (£1.91bn), a 53 per cent drop on the same period in 2008. <br /><br />Underlying net profit was $2.9bn, down 66 per cent on the second quarter last year. <br /><br />“We are in turbulent times, volatile and uncertain. But we continue to steer a steady course through choppy waters,” chief executive Tony Hayward said.<br /><br />A drop in the price of oil and gas has hit all oil companies, including rival Shell, which puts out its second quarter results tomorrow.<br /><br />But BP, which began pruning its business before its rivals, said its cost-cutting drive and production in oil and gas were both progressing well. <br /><br />It has made over 5,000 job cuts, and said it has already met its targeted savings for the year of $2bn <br /><br />The group added that it expected to hit $3bn of savings by the end of 2009.<br /><br />Finance costs and expenses relating to pensions and other post-retirement benefits were $321m for the second quarter, compared to $221m for the same period last year.<br /><br />Meanwhile, BP’s Russian joint-venture TNK-BP International said its net profit more than halved to $2bn in the first six months of 2009 as lower oil prices offset an increase in production.<br /><br />Its first-half revenues fell to $14.5bn from $28.3bn a year earlier. Earnings were $3.8bn, compared with $7.6bn in the year before.
Wednesday 29 July 2009 1:00am
Profits at BP slump by half in downturn
