BP expects its oil trading result to be slightly higher in the second quarter after an exceptionally strong first quarter, as it continues to profit from a surge in oil prices caused by the Iran war.
The British major flagged higher oil realizations, which it said would increase earnings in its oil production and operations business by $1.8 billion to $2.1 billion compared with the first quarter, helped by price-lag effects on production in the Gulf of Mexico and the United Arab Emirates. In its gas and low carbon energy segment, realizations are expected to add a further $500 million to $700 million, it said on Tuesday.
Gas trading results are expected to be broadly unchanged from the previous quarter.
Oil prices and refining margins surged during the quarter after the conflict in the Middle East resulted in Iran effectively shutting the Strait of Hormuz, disrupting global supply. The higher crude prices and strong trading results have also boosted other oil majors.
Global benchmark Brent crude prices LCOc1 hit multi-year highs and averaged around $97 per barrel during the April-to-June quarter, up from around $78 in the first quarter and about $67 a year earlier.
BP said refining margins averaged $29.6 per barrel, versus $16.9 in the first quarter.
The company expects upstream production to fall in the second quarter to between 2.17 million and 2.22 million barrels of oil equivalent per day from around 2.34 million boed in the previous three months, due in part to the effects of the crisis.
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