 The hurricanes in the US have hit a number of industries |
Oil giant BP has reported a strong rise in annual profits in the third-quarter but admitted its performance was hit by the recent hurricanes in the US. Replacement cost profits were $4.41bn (�2.49bn) in the period, an increase of 16% on the year, but down on the $4.98bn profit from the second quarter.
Underlying performance was strong, BP said, thanks to "high but volatile" oil and gas prices.
BP described the recent sale of its Innovene division as a "good outcome".
Driving profits were strong results from its upstream oil production unit, the company said, while refining profit margins hit record levels.
Record oil prices
Excluding one-off items of $921m, underlying profits rose to $5.33bn, up from $4.18bn a year ago, and roughly in line with expectations.
Crude oil prices reached record levels during the quarter, breaching the $70-a-barrel mark. Now crude has eased back to trade at about $60 a barrel.
"I would expect prices in the short term to be relatively strong. The future is always unknown. But it is our view that in the end these prices are unsustainable," Lord Browne told the BBC.
"Something like $40 on average in the medium term is the level we would expect."
On a nine-monthly basis, BP reported profits of $14.88bn for the period to 30 September - up 25% on the year.
BP said it would pay a quarterly dividend of 8.925 cents (5.061 pence) per share, up from 7.1 cents a year ago.
The world's second-largest listed oil company said it may well have posted record quarterly profits had it not been for the impact of Hurricanes Katrina and Rita.
Hurricane factor
Production for the quarter was down 2% on the year as raging storms in the Gulf of Mexico crippled oil rigs and halted output in the region. Oil refineries on land were also disrupted.
The cost of repairing its Thunder Horse platform, which was left listing during Hurricane Dennis in July, totalled �107m.
Production on the rig is unlikely to restart before the second half of 2006.
Additionally, earnings from selling fuel at the pumps were disappointing as BP was unable to fully pass on price rises to customers.
"The recent hurricanes in the US have impacted our results," said chief executive Lord Browne.
"However, underlying performance is strong, amplified by high but volatile prices of oil, gas and products."
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The recent hurricanes in the US have impacted our results
