BP shares edge up despite hit from lower oil and gas prices
BP has said it expects second quarter results next month to be impacted by lower oil and gas prices.
Crude oil prices average $67.9 per barrel over the three-month period, compared with $75.7 per barrel in the prior quarter.
“In the gas and low carbon energy segment, realisations compared to the prior quarter, are expected to have an impact in the range of $0.1bn to $0.3bn,” BP said in a statement on Friday.
Realisations in its oil production and operations business are also expected to have an impact in the range of $0.6 to $0.8bn, including price lags on BP’s production in the Gulf of America and the UAE.
Its second quarter results will also include costs associated with asset impairments in the range of $0.5bn to $1.5bn.
BP forecasts higher production
Despite the hit, shares in BP jumped more than two per cent in early deals as the London-listed firm forecast higher quarter-on-quarter production and said net debt had declined. BP’s debt pile sat at $27bn at the end of the last quarter.
Its second quarter gas marketing and trading result is expected to be average, while oil trading is expected to be strong, BP added.
It comes after ministers and executives from a host of OPEC nations said earlier this week that markets were “thirsty” for more oil.
BP has faced mounting pressure to turn around its underperforming share price this year, leading to a pivot back to oil and gas that has angered climate-conscious investors.
The group suffered a huge shareholder revolt at its annual general meeting in April, the largest protest vote against the chair of a FTSE 100 company in half a decade.
Shares are down around 1.5 per cent this year to date.