BP BP Plc

BP PLC on Tuesday reported market-beating third quarter earnings and said that it could operate as a going concern for the next year even if the price of Brent fell to zero. Here's what the FTSE 100-listed oil major had to say:

On upstream production:

"Relative to the second quarter, upstream reported production rose by 4%, hydrocarbon plant reliability increased to 95% and refining availability increased to 96%."

On oil prices:

"Oil prices have continued to increase, and inventories have reduced back towards pre-pandemic levels."

On going concern:

"Reverse stress tests indicated that the group will continue to operate as a going concern for at least 12 months from the date of approval of the interim financial statements even if the Brent price fell to zero."

On gas markets:

"Gas markets were very strong in the quarter and we expect they will remain tight during the period of peak winter demand."

On guidance:

"Looking ahead, we expect fourth quarter reported upstream production to be higher than the third quarter reflecting major project ramp-up, mainly in gas regions, recovery from seasonal maintenance activity and continuing impacts from Hurricane Ida on our non-operated production in the U.S. Gulf of Mexico."

"In our customer businesses, we expect lower product demand due to seasonal impacts and continued base oil tightness and additive supply shortages in Castrol."

"In products, refining margins are expected to be lower in the fourth quarter driven by seasonal demand and we expect energy prices to remain under pressure and maintenance activity to remain high."

"We expect upstream underlying production to be slightly higher than 2020 with the ramp-up of major projects, primarily in gas regions, partly offset by the impacts of reduced capital investment and decline in lower-margin gas assets."

"For full year 2021 we continue to expect reported upstream production to be lower than 2020 due to the impact of the ongoing divestment program. However, we expect upstream underlying production to be slightly higher than 2020 with the ramp-up of major projects, primarily in gas regions, partly offset by the impacts of reduced capital investment and decline in lower-margin gas assets."

"BP continues to expect capital expenditure, including inorganic capital expenditure, of around $13 billion in 2021."

"Depreciation, depletion and amortization is still expected to be at a similar level to 2020."

"Gulf of Mexico oil spill payments for the year are still expected to be around $1.5 billion pre-tax."

"The other businesses & corporate underlying annual charge is still expected to be in the range of $1.2-1.4 billion for 2021. The quarterly charges may vary from quarter to quarter."

Write to Ian Walker at ian.walker@wsj.com

(END) Dow Jones Newswires

November 02, 2021 07:23 ET (11:23 GMT)

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