Profits down by 50% at BP, but Shell is back in black
Oil giant BP has said profits nearly halved in the third quarter as it remained under pressure from low oil prices. The group posted underlying replacement cost profits - the benchmark industry measure - of $933m (£762.8m) for the three months to the end of September against $1.82bn (£1.49bn) a year earlier.
BP warned that oil refining margins would continue to take a hit in the final three months of the year, but added that it expects production to increase slightly in the fourth quarter.
The group is slashing costs in the face of weak global oil prices and sliding refining margins, with the cost of crude at around $46 to $48 a barrel in the third quarter compared with $50 a year ago.
Brian Gilvary, BP's chief financial officer, said: "We continue to make good progress in adapting to the challenging price and margin environment."
Meanwhile, Royal Dutch Shell swung into profit in the third quarter as a cost-cutting and divestment programme began to bear fruit.
The oil giant said profits came in at $1.4bn (£1.1bn) compared with a $6.1bn (£5bn) loss in the same period last year as the company also reaped the benefits of its acquisition of BG Group.
Adjusted profit, which strips out exceptional items, also rose from $2.4bn (£2bn) to $2.8bn (£2.3bn) in the period.
However, chief executive Ben van Beurden warned that the outlook for the industry, which continues to be hit by low oil and gas prices, remained uncertain.
He said: "Shell delivered better results this quarter, reflecting strong operational and cost performance.
"But lower oil prices continue to be a significant challenge across the business, and the outlook remains uncertain."