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| Version 1 | Version 2 |
|---|---|
| BP profits hit by lower oil price | BP profits hit by lower oil price |
| (40 minutes later) | |
| Lower oil prices have continued to hurt BP, with its third-quarter profits more than halving from a year ago. | Lower oil prices have continued to hurt BP, with its third-quarter profits more than halving from a year ago. |
| Its replacement cost profit between July and September was $4.98bn (£3bn), down from $10bn a year earlier. | Its replacement cost profit between July and September was $4.98bn (£3bn), down from $10bn a year earlier. |
| However, the results were ahead of analysts' forecasts after the company made bigger-than-expected cost cuts. | However, the results were ahead of analysts' forecasts after the company made bigger-than-expected cost cuts. |
| Although oil prices have risen in recent months to about $80 a barrel, they are well off the $147 high set in July last year. | Although oil prices have risen in recent months to about $80 a barrel, they are well off the $147 high set in July last year. |
| The better-than-expected results sent shares in BP up by more than 5% in early trade on the London Stock Exchange. | |
| Refining influence | |
| BP said unit production costs were 18% lower than in the third quarter of 2008, while oil and gas production was up 7% on last year. | BP said unit production costs were 18% lower than in the third quarter of 2008, while oil and gas production was up 7% on last year. |
| REPLACEMENT COST PROFIT Replacement cost profit is the reporting measure typically used by oil companies and reflects the current cost of suppliesThe measure strips out gains or losses related to any changes in the value of the firm's stock of fuel products class="" href="http://newsvote.bbc.co.uk/1/shared/fds/hi/business/market_data/shares/3/87080/intraday.stm">See BP's share price | |
| Nick McGregor, oil analyst at Redmayne Bentley, said that BP's refining business was also key. | |
| "For every dollar that oil prices go up, BP make about $400m. For every dollar that refining margins go up, they make about $950m," he said. | |
| "The exploration and production is the most profitable in absolute terms because it's the biggest bit, but refining is a big influence on the overall bottom line." | |
| Net income at its Russian joint venture TNK-BP rose 34% to $1.7bn. | Net income at its Russian joint venture TNK-BP rose 34% to $1.7bn. |
| The project had been marred by a dispute between BP and the Russian shareholders in the venture, and was only resolved in September last year when Robert Dudley stepped down as TNK-BP's chief executive. | The project had been marred by a dispute between BP and the Russian shareholders in the venture, and was only resolved in September last year when Robert Dudley stepped down as TNK-BP's chief executive. |
| BP said the venture was well-positioned to deliver a solid performance in 2009. | BP said the venture was well-positioned to deliver a solid performance in 2009. |
| BP was also buoyed last month by a "giant" new oil discovery in the Gulf of Mexico. | BP was also buoyed last month by a "giant" new oil discovery in the Gulf of Mexico. |
| The company said the discovery amounted to more than three billion barrels. Its well in the region, dubbed Tiber, has been drilled to a total depth of about 35,055ft (10,685m), making it one of the deepest wells drilled to date. |