BP has posted a jump in its quarterly profits as the war in the Middle East drove up oil and gas prices and led to “significantly higher” trading.
The energy company said on Friday that third-quarter underlying replacement cost profit – a key measure of its income – rose to $8.46bn, up from $2.2bn a year ago. Analysts had expected profits of $7.33bn.
The company said the jump in profits “mainly reflects significantly higher realised refining margins and significantly higher gas and marketing trading result”.
BP’s quarterly earnings were bolstered by higher profits from the oil refining business. Although global oil prices have remained below the peaks recorded during the 2022 energy crisis, the pump prices for fuels including diesel have soared to all-time highs across the UK, Europe and the US in recent months because of severe disruptions to refineries in the Gulf region and across Russia.
Meg O’Neill, the chief executive of BP, said: “These are dynamic times with volatility and disruption to trade flows continuing to define energy markets. The industry as a whole has been showing remarkable adaptability. Refineries have been running close to capacity to make up for shortfalls, shipping has been taking different and longer routes, and releases from strategic and commercial reserves are helping to bridge supply gaps.”
The jump in BP’s profits angered climate campaigners. Danny Gross, of Friends of the Earth, said: “As millions of households brace themselves for a cold winter huddling under blankets and clutching hot-water bottles as they struggle to pay their bills, BP is raking in huge profits while doubling down on gas and oil production and slashing investment in renewables.”
BP laid bare its earnings windfall after Shell and the French oil rival TotalEnergies reported their strongest profits since 2022 , also in large part thanks to the profits made from refining crude into fuel products such as diesel.
The US-Israeli war on Iran has boosted profits for oil majors, leading to questions over how they will allocate the extra cash. BP said on Friday it would use the excess cashflow generated by earnings to address remaining liabilities in full from the Deepwater Horizon oil spill in 2010.
Deepwater Horizon oil spill payables and provisions stood at $5.94bn, according to BP data.
BP is expected to set out its first major strategy update under O’Neill on 15 December, which market observers expect will outline the company’s plans to grow its oil and gas production and potentially restart share buybacks from next year.
