BENGALURU, April 11 (Reuters) – British energy company BP said on Thursday it expects a decline in production for the first quarter of 2024 compared to the previous three months. The drop is mainly due to weaker gas output and asset sales in Egypt and Trinidad and Tobago, which have offset gains in oil production.
This update gives investors an early look at BP’s quarterly performance. The company has been under growing pressure from shareholders who are questioning its spending discipline, share buyback strategy, and the pace at which it is transitioning to cleaner energy. Investor scrutiny has intensified after activist fund Elliott Management took a stake in BP.
BP said earnings from its oil production and operations segment will likely remain flat compared to the last quarter. This is partly due to pricing delays in regions like the Gulf of Mexico and the United Arab Emirates.
Although pricing for BP’s gas and low-carbon energy segments is expected to stay stable, the company warned of underperformance in its gas marketing and trading business, which could affect results.
The company also said it expects its net debt to rise by around US$4 billion from the previous quarter. This increase is largely due to seasonal inventory builds and timing of payments, including annual bonuses and costs from recent low-carbon asset sales.
On a more positive note, BP expects higher refining margins to add between US$100 million and US$300 million to first-quarter earnings. However, oil trading profits are likely to stay flat.
BP is set to release its full first-quarter financial results on April 29.
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