BP sees refining margin triple, debt target reached, but flags more impairments
BP•BP expects its third-quarter refining indicator margin to rise to $46.70 per barrel from $29.60 in the second quarter, lifting products-segment profit by $1.9 billion to $2.1 billion. It also flagged $3 billion to $4.5 billion in impairments and expects net debt of $13.5 billion to $14.4 billion, reaching its target about a year early.
1. Margins and impairments
BP estimated its July-September refining indicator margin at $46.70 per barrel, compared with $29.60 in the second quarter and $15.80 a year earlier. The company said the increase would lift profit in its products segments by $1.9 billion to $2.1 billion versus the previous quarter. BP also flagged $3 billion to $4.5 billion in impairments related to its gas and low-carbon energy segment, but provided no further details.
2. Debt and trading outlook
BP expects net debt of $13.5 billion to $14.4 billion for the quarter, reaching its target range of $14 billion to $18 billion about a year early. It expects gas marketing and trading results to significantly exceed the previous quarter, while oil trading results are expected to be broadly flat. BP's third-quarter results are due October 30.
3. Other figures
BP estimated overall obligations, including hybrid bonds, leases and Deepwater Horizon liabilities, at $43.6 billion to $44.6 billion, down from $53.6 billion in the previous quarter. Upstream production was estimated at 2.19 million to 2.24 million barrels of oil equivalent per day, compared with 2.2 million in the previous quarter.
