28 April 2009 09:40 [Source: ICIS news]
LONDON (ICIS news)--BP’s refining and marketing business posted a pre-tax profit of $1.42bn (€1.09bn) in the first quarter, down from $2.57bn in the same period last year but up from a $8.06bn loss in the fourth quarter, the UK oil and gas major said on Tuesday.
The segment's first-quarter replacement cost profit before interest and tax, which includes the energy giant's aromatics and acetyls businesses, fell 13% to $1.09bn from $1.25bn in the first quarter last year.
“Compared to the same quarter last year, the segment’s performance was significantly better, with the benefits of improved operational and cost momentum more than offsetting the effects of a weaker environment,” the company said.
BP said that despite the improved global refining indicator margins, actual refining margins were worse than the same quarter last year.
Petrochemicals margins and volumes were also significantly worse than a year ago.
Chemicals production in the quarter totalled 2,620,000 tonnes compared with 3,536,000 tonnes in the same period last year, but up from 2,387,000 tonnes in the fourth quarter last year.
“In the first quarter, US refining margins returned to a modest premium relative to other regions and the unusual adverse impacts from prior-month pricing of domestic pipeline barrels, [which] impacted our fourth-quarter results, were not repeated,” said BP.
The company said the overall weak environment for marketing and petrochemicals was expected to continue.
“Refining margins were weak in March and the extent of seasonal demand factors will be a significant determinant of refining margins in the second quarter,” it said.
“Our refining availability is expected to remain higher than in 2008,” BP said, adding that scheduled maintenance in the second quarter was expected to have a greater impact than in the first quarter.
At group level, BP reported net profits of $2.56bn in the first quarter, a slump from $7.09bn in the same period last year.
Replacement cost profits dropped 62% to $2.39bn from $6.23bn in the first quarter of 2008, primarily on lower realisations and lower earnings from equity-accounted entities in its exploration and production unit due to lower prices and the effect of lagged tax reference prices.($1 = €0.77)
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