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BP profits slump but outlook improves for new CEO

petrol prices
BP has seen energy prices fall (pic: Terry Murden)

Energy giant BP said profits halved last year as oil and gas prices cooled and refining profit margins weakened.

Underlying replacement cost profit, its preferred measure fell by 50% in 2023 to $13.8bn from $27.6bn a year earlier.

It delivered fourth-quarter profit of $3 billion, exceeding forecasts thanks to strong gas trading.

Looking ahead, it expects first quarter 2024 reported upstream production to be higher compared to the final three months of 2023.

The strong fourth quarter profit will provide some comfort to new CEO Murray Auchincloss after the company had substantially missed forecasts in the previous two quarters.

BP maintained its dividend at 7.27 cents per share and increased the rate of its share buyback programme to $1.75 billion over the next three months from $1.5 billion in the previous three months.

The company said it was committed to repurchasing $3.5 billion of shares in the first half of 2024.

After serving as an interim chief financial officer (CFO) since September last year, Kate Thompson has been appointed CFO and will join the company’s board with immediate effect.

Before joining BP, Ms Thompson worked for professional services firms including Ernst & Young in M&A tax and as group head of tax for Charter.

Previous CEO Bernard Looney resigned last September after admitting he had not been “fully transparent” about his past personal relationships at the firm. BP’s board said Mr Looney had committed “serious misconduct”, resulting in him forfeiting up to £32.4m.

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