MOSCOW (MRC) -- BP posted a sharp drop in third-quarter profit, hurt by weaker oil prices and lower production, but still beat expectations even as it took a one-off charge of USD2.6 billion linked to large asset sales, said Reuters.
London-based BP said third-quarter underlying replacement cost profit, the company’s definition of net income, fell 40% from the year earlier period to USD2.3 billion. That exceeded a forecast of USD1.73 billion in a company-provided survey of analysts and compared to USD2.81 billion in the second quarter of 2019.
The drop will not come as a surprise to investors after BP indicated earlier this month that it would take a non-cash charge of USD2 billion to USD3 billion in the quarter as it gets closer to disposing of assets worth USD10 billion by the end of 2019, a year ahead of schedule.
The USD2.6 billion charge nevertheless pushed the firm to its first quarterly net loss, of USD700 million, since the second quarter of 2016.
Although profit came under pressure, cashflow, seen as the main measure of BP’s underlying performance, was unchanged from a year earlier at USD6.1 billion.
Oil and gas production, excluding its share from its 19.75% stake in Russia’s Rosneft, was down 2.5% from a year earlier at 2.568 million barrels of oil equivalent per day as a result of maintenance at several high-margin fields and a two-week disruption to production in the U.S. Gulf of Mexico from Hurricane Barry.
A 17% drop in oil prices in the third quarter from a year earlier also weighed heavily on profits of other energy companies including Italy’s Eni and Norway’s Equinor.
BP earlier this month announced Dudley will retire next year following a tumultuous decade at the helm of the company. He will be succeeded by 49-year-old Bernard Looney, BP’s head of upstream.
As MRC reported earlier, BP Plc is expected to resume operation at its small gasoline-producing fluidic catalytic cracking unit (FCCU) at its 430,000 barrel-per-day (bpd) Whiting, Indiana, refinery in late October after about a month of the overhaul. The company began a planned overhaul of the small FCCU on 19 September.
PTA is used to produce polyethylene terephthalate (PET), which is used in the manufacturing of plastic bottles, films, packaging containers, in the textile and food industries.
According to MRC's DataScope report, Chinese bottle grade PET deliveries to Russia increased 34% in the first eight months of 2019 to 95,600 tonnes. China accounted for 90% of the total imports, compared to 85% a year earlier.
August imports of material from China decreased by 41% to 7,600 tonnes from 12,800 tonnes in July. Jiangsu Sanfangxiang, Yisheng, Wankai and Sinopec were the leading Chinese suppliersof material to the Russian market.
BP is one of the world's leading international oil and gas companies, providing its customers with fuel for transportation, energy for heat and light, retail services and petrochemicals products for everyday items.
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