The energy firm revealed that “exceptional oil and gas trading” had helped boost profits on its energy sales. Underlying profits came in at $6.2billion (£4.95billion) for the first three months of 2022, up from $4.1billion (£3.27billion) in the previous quarter. Energy prices had been rising even before the Ukraine invasion with both sets of results marking a stark change to the first quarter of 2021 which saw underlying profits of just $2.63billion (£2.1billion) as demand for fuel remained depressed by the pandemic. Along with its quarterly results, BP has also outlined plans to invest £18billion in the UK’s energy system across a range of projects between now and 2030.
These will include investment in lower emission oil and gas projects in the North Sea as well as renewables such as developing offshore wind capacity, electric vehicle charging and creating two large-scale hydrogen production facilities in Teesside.
According to BP its investment in hydrogen will produce 15 percent of the Government’s target of 10GW of capacity by 2030 and create more than 600 operational jobs and 1,200 construction jobs in Teesside by 2027.
BP CEO Bernard Looney said: “We’re backing Britain.
“It’s been our home for over 110 years, and we’ve been investing in North Sea oil and gas for more than 50 years.
The Government meanwhile has insisted such plans would be counterproductive by discouraging energy firms from investing.
While BP has seen growing profits from its energy sales its overall balance sheet however has been severely dented by its exit from a stake in Russian energy giant Rosneft.
Abandoning its stake in the firm has seen BP book a loss of $20.4billion (£16.26billion) in its quarter one results as western firms have increasingly severed ties to Russia despite heavy costs.
BP was joined by Shell in cutting links, with Shell exiting a number of joint ventures with Russian state energy firm Gazprom.
BP’s Mr Looney said: “Our decision in February to exit our shareholding in Rosneft resulted in the material non-cash charges and headline loss we reported today.
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“But it has not changed our strategy, our financial frame, or our expectations for shareholder distributions.”
BP’s share price rose 2.75 percent in this morning’s trading with the firm pushing ahead with a share buyback which will likely further boost value for investors.
Victoria Scholar, Head of Investment at interactive investor, said: “Oil majors like BP have been among the key beneficiaries of the sharp rally in crude prices during the quarter, laid bare by its sky-high profits and surplus cash flow during the quarter, allowing the company to return cash to shareholders via an accelerated share buyback scheme.
“While the stock is trading higher, investors are still weighing up the strength of its bottom line against the cost of exiting Russia, which accounted for 3 percent of its cash flow last year, resulting in hefty write downs in today’s report.”