BP swings back into profit in Q2

BP on August 2 became the latest international oil and gas major to post positive earnings feedback for the second quarter, reporting a headline profit of $9.3bn that allowed it to lift shareholder dividends by 10% yr/yr and offer $3.5bn of new share buy backs.

The profit marks a 14-year high for BP on the back of soaring oil and gas benchmarks, but was partially offset by a softer performance at its gas marketing and trading sector, attributed to an "exceptional" first quarter result and the impact of Freeport LNG's unexpected closure in the US. BP receives 4mn metric tons/year of LNG from the US Gulf Coast liquefaction plant, representing 22% of its overall 18mn mt/yr portfolio.

Bernard Looney, CEO of BP, said: "Today's results show that BP continues to perform while transforming. Our people have continued to work hard throughout the quarter helping to solve the energy trilemma - secure, affordable and lower carbon energy.

"We do this by providing the oil and gas the world needs today - while at the same time, investing to accelerate the energy transition."

Despite the gas trading setback, BP's second quarter data overall was a big turnaround from January to March where the business racked up a $20.4bn loss thanks to the colossal $24.4bn impairment booked on its exit from Russia, including BP's 19.75% Rosneft stake, in light of the Ukraine war.

BP was one of the hardest hit by Russian draw-down impairments last time round, so this was an opportunity to showcase its fundamentals. Surplus cash flow of $6.6bn helped underpin BP's continued share buyback programme, giving equity holders an exit funded by 60% of its cash flow, with the remainder to be reinvested into the business.  BP also said it had managed to reduce its debt pile for the ninth consecutive quarter. Net debt stood at $22.8bn by the end of June, down from $27.5mn on March 31.