May 08, 2024 (MENAFN via COMTEX) --
(MENAFN - Baystreet) Lower oil and gas prices and a prolonged refinery outage in the United States dragged down BP's earnings for the first quarter to below analyst expectations.
UK-based supermajor BP (NYSE: BP) reported on Tuesday an underlying replacement cost profit - the closest metric to net profit - of $2.7 billion for the first quarter of 2024, down from $3.0 billion for the previous quarter.
"Compared with the fourth quarter 2023, the result reflects lower oil and gas realizations, the impacts of the Whiting refinery outage and significantly weaker fuels margin, partially offset by a significantly lower level of turnaround activity, a strong oil trading result and higher realized refining margins," BP said in a statement.
The Whiting, Indiana, refinery of BP, was shut for most of February and half of March after a power outage prompted a temporary shutdown of the facility. The 435,000 barrels-per-day refinery, the largest refining complex in the Midwest, was offline for around six weeks, pushing U.S. fuel supply and refinery utilization lower in the first quarter of 2024.
BP's upstream oil and gas production rose by 2.1% year-over-year to 2.378 million barrels of oil equivalent per day (boepd) in the first quarter. The higher hydrocarbon production, however, failed to offset lower oil and gas prices, weaker refining results, and the outage at the U.S. refinery.
Despite the weaker profits for the first quarter of 2024, BP announced a $1.75 billion share buyback for the first quarter as part of its commitment of $3.5 billion for the first half of 2024.
BP and its European peer Shell have been looking to narrow the stock valuation gap compared to their U.S. competitors.
Shell also announced last week a share buyback of $3.5 billion this quarter. But unlike BP, Shell reported strong earnings for the first quarter, smashing analyst expectations thanks to higher margins from crude and oil products trading and optimization, and higher refining margins.
By Tsvetana Paraskova for Oilprice
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COMTEX_452057171/2604/2024-05-08T06:37:57
