BP annual profit slides to $4.0bn on lower oil prices

LONDON: British energy giant BP yesterday said annual net profit slumped 57 percent to $4.0 billion last year, hit by weaker oil prices, as long-time chief executive Bob Dudley bowed out.

The figure, equivalent to 3.6 billion euros, compared with profit after tax of $9.38 billion in 2018, the company said in a statement marking the end of American Dudley’s decade at the helm.

It was announced in October that Irish national Bernard Looney would replace Dudley, who steps down after a 40-year career at BP. Looney joined BP in 1991 as a drilling engineer, rising to lead its upstream division that comprises exploration and production.

“After almost ten years, this is now my last quarter as CEO,” Dudley said in yesterday’s statement.

“In that time, we have achieved a huge amount together and I am proud to be handing over a safer and stronger BP to Bernard and his team. “I am confident that under their leadership, BP will continue to successfully navigate the rapidly-changing energy landscape,” he added.

Despite the dive in annual net profit, BP’s share price surged 4.0 percent in London morning deals.

“BP boosted its dividend... despite a substantial fall in profits because of weaker crude prices,” noted Neil Wilson, chief market analyst at Markets.com. “The worry for the oil majors now is that we see ongoing demand destruction in Asia from the coronavirus outbreak that bleeds into Brent crude prices throughout the year.” BP noted that average Brent crude prices slid last year to below $65 per barrel from above $71 in 2018.

Benchmark Brent was trading at around $55 yesterday after massive falls over the past week linked to the impact of coronavirus on global energy demand should the economy tank.

While traditional energy companies remain massively dependent on income from fossil fuels, in the latter years of Dudley’s reign BP increasingly moved into cleaner energies, fuelled by changing public attitudes and government policies towards carbon emissions and climate change.