BP Rebounds to Second-Quarter Profit on Soaring Energy Prices

BP Rebounds to Second-Quarter Profit on Soaring Energy Prices

/ Financial News / Tuesday, 02 August 2022 11:14

British oil giant BP rebounded to a second-quarter profit on soaring energy prices, the company stated, after a big loss linked to its Russia exit following Moscow's invasion of Ukraine.

Net profit hit $9.3 billion in the three months to June – a threefold increase from the same period last year, the company said in a results statement.

That contrasted sharply with a $20.4-billion loss in the first quarter, when it took a vast write down after its decision to leave Russia.

BP is the latest energy major to post bumper second-quarter earnings as oil and gas prices have surged in the wake of key producer Russia's invasion of Ukraine.

Prices have also spiked after countries lifted Covid pandemic lockdowns, spurring global energy demand.

Turning to the third-quarter outlook, BP forecasts that oil prices will "remain elevated ... due to ongoing disruption to Russian supply, reduced levels of spare capacity and with inventory levels significantly below the five-year average".

And it warned gas prices will also remain "elevated and volatile" as Russia also squeezes European supplies in retaliation for Western sanctions over the assault on Ukraine.

The gas outlook was "heavily dependent on Russian pipeline flows or other supply disruptions," BP added.  

Windfall tax pleas

At the same time, BP posted a net loss of $11.1 billion for the first half of 2022. That was sparked by a colossal charge of $24.4 billion, linked to a decision to exit its 19.75% stake in Russian energy group Rosneft.

That wiped out the overall benefit of high energy prices in the first half.

Gas prices, which skyrocketed in March after Russia launched its invasion of neighboring Ukraine, surged last week after Moscow curbed crucial deliveries to Europe.

The market remains at its highest level since March after state-run Gazprom suspended gas deliveries to Latvia.

Latest Issue

Please publish modules in offcanvas position.