British energy giant BP returned to a small profit in the third quarter of 2020 but warned remaining uncertainty was caused by the coronavirus pandemic. According to BP, fuel demand is recovering unevenly, with consumption improving in Asia, especially China, but remaining weak globally so far in the fourth quarter. At the same time, investors are worried about the company’s ability to shift toward renewable energy successfully.
BP reported a net income of $86 million in the quarter thanks to higher crude prices and stronger results from the company’s natural gas trading business. The figure beat analysts’ estimates of a $120 million loss and followed a record $6.7 billion loss in the second quarter. BP refineries were operating at 80% of capacity in the third quarter, about 15% below pre-crisis levels, due to weak fuel consumption. BP’s refining margin stood at $6.20/barrel, up slightly from the second quarter but less than half of margins in the same quarter last year.
BP intends to expand its renewable power capacity by twenty-fold by 2030 while reducing its crude production by 40%. The company also plans to divert more spending to low-carbon investments while reducing the workforce by 10,000 or 15% over the next few quarters. Investors have welcomed the new strategy but, at the same time, were cautious about BP’s ability to generate the targeted profit margins during the transition.
By the end of September, BP’s debt-to-equity ratio was 37.7%, relatively steady from the previous quarter and increased from 35.9% a year earlier. BP’s shares have fallen by over 50% this year and remained near 25-year lows, but they gained 1.65% on October 27.
Tags: AlwaysFree,Crude Oil,English,Gas,World
Published on October 28, 2020 5:16 PM (GMT+8)Last Updated on October 28, 2020 5:16 PM (GMT+8)
