BP Swings to Profit as Oil Sector Shakes Off Woes
May 02 2017 - 3:26AM
Dow Jones News
By Sarah Kent
LONDON-- BP PLC was the latest big oil company to report a sharp
increase in profit in the first quarter Tuesday, adding to optimism
that the sector may have endured the worst of a dramatic slump in
prices.
The British oil giant said it swung to a profit in the first
quarter, benefiting from a roughly 60% increase in prices since the
first quarter of 2016 compared with a year earlier and higher
production volumes.
The results are the latest a flurry of positive earnings reports
by the world's biggest oil companies, several of which have enjoyed
their most successful quarter in more than a year. The sharp
improvement in financial performance has left investors hopeful
that the sector may be on the path to recovery after struggling to
come to grips with a sharp drop in oil prices since the summer of
2014.
Last week, Exxon Mobil Corp. reported its best quarter since
2015. Chevron Corp. posted a profit of $2.7 billion, after
reporting a loss for 2016 and France's Total SA saw its profit
surge 77% in the first three months of the year. Royal Dutch Shell
PLC is due to report later this week.
BP said Tuesday its replacement cost profit--a number analogous
to the net income that U.S. oil companies report--was $1.4 billion
in the first quarter, compared with a loss of $485 million in the
same period a year earlier.
The company's operating cash flow excluding payments related to
the company's fatal Gulf of Mexico blowout in 2010 improved to $4.4
billion in the first quarter, helping the company maintain its
dividend at 10 cents per share and reassuring investors, who
received a jolt in February when the company said it would need oil
prices to rise to $60 a barrel to break even this year.
Write to Sarah Kent at sarah.kent@wsj.com
(END) Dow Jones Newswires
May 02, 2017 03:11 ET (07:11 GMT)
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