BP’s profits fell in the third quarter of the year amid growing pressure from investors to boost returns to shareholders.
The British oil and gas supermajor’s underlying quarterly profits dropped by 18% to $2.27 billion (£1.75 billion) from $2.76 billion in the three months to September.
Although the profit figure was slightly above City analysts’ expectations it was the weakest quarterly result since the end of 2020 when global demand collapsed during the pandemic lockdowns.
Profits for thre first nine months of the year are down from $10.85 billion to $7.45 billion.
The results come against a backdrop of weaker oil prices and investor discontent with management strategy. The shares are down around 15% this year.
The price of a barrel of Brent Crude has slumped by almost $9 this month from highs of around $80 at the start of October to around $71.60 today on hopes that the Middle East can avoid an all out war that would restrict production, as well as an OPEC downgrade of its forecast for global demand this year and next.
Meanwhile London based activist investor Bluebell Capital Partners has criticized BP’s management and energy strategy, calling for the resignation of its chairman Helge Lund.
Today CEO Murray Auchincloss said: “We have made significant progress since we laid out our six priorities earlier this year to make BP simpler, more focused and higher value. In oil and gas, we see the potential to grow through the decade with a focus on value over volume.
“We also have a deep belief in the opportunity afforded by the energy transition - we have established a number of leading positions and will continue high-grading our investments to ensure they compete with the rest of our business. I am absolutely clear that the actions we are taking will grow the value of BP.”
Chief financial officer Kate Thomson said: ”In the third quarter, we delivered an underlying replacement cost profit of $2.3 billion while continuing to transform our business. We are in action to deliver efficiencies and are confident in achieving at least $2 billion of cash cost* savings by the end of 2026 relative to 2023. Our financial frame is unchanged. Today, we are announcing a dividend of 8 cents per share and a $1.75 billion share buyback as part of our $3.5 billion commitment for the second half of 2024.
