BP posts $485m Q1 loss

The weak oil price pushed exploration and refining giant BP to a $485m first quarter replacement cost loss, compared with a profit $2.1bn profit in the same period last year.

Underlying replacement cost profit was $532m for the quarter, compared with $2.57bn a year ago and well above analysts consensus forecasts of a $140m loss.

Pre-tax losses were $865m compared with a $2.2bn profit in the first quarter of 2015.

“Despite the challenging environment, we are driving towards our near-term goal of rebalancing BP's cash flows. Operational performance is strong and our work to reset costs has considerable momentum and is delivering results. Furthermore, development of our next wave of material upstream projects is well on track," said chief executive Bob Dudley.

"Market fundamentals continue to suggest that the combination of robust demand and weak supply growth will move global oil markets closer into balance by the end of the year.”

Organic capital expenditure in the first quarter was $3.9bn compared to $4.4bn in the first quarter of 2015. BP said it now expects total organic capital expenditure in 2016 to be around $17bn and, in the event of continued low oil prices, sees flexibility to move to $15bn-$17bn in 2017.

BP said cash costs over the last four quarters were $4.6bn lower than in 2014, adding that it expected those for 2017 to be $7bn than for 2014.

“The Brent oil marker price averaged $34 a barrel in the quarter, compared with $44 in the fourth quarter of 2015 and $54 in the first quarter of 2015, and refining margins were at the lowest quarterly average for over five years. Brent prices have so far averaged $40 in the second quarter.”