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BP upbeat on production, cautious on prices

Oil and gas giant BP (LSE: BP) saw its share price rise 1.8% this morning on the back of an upbeat production forecast for the first quarter of 2024. While BP expects increased oil and …

Oil and gas giant BP (LSE: BP) saw its share price rise 1.8% this morning on the back of an upbeat production forecast for the first quarter of 2024.

While BP expects increased oil and gas output, lower gas prices could hit profits by $200 million to $400 million. A weaker Egyptian pound adds another $200 million burden.

BP’s oil segment will also face lower realisations, impacting profits by $300 million to $600 million due to price lags and declining gas prices.

The gas marketing and trading segment remains strong, but the customers and products segment faces mixed factors. Refining benefits from improved margins, but turnaround activity is lower and a February power outage hurt results. Weaker fuel margins and seasonal volume dips are expected in the customers division.

BP forecasts full-year capital expenditure of $16 billion, weighted to the second half. Net debt is expected to rise in Q1 due to working capital and phasing of investments.

BP’s announcement follows Shell’s report of lower gas trading activity compared to a strong Q4. However, Shell expects its gas division to remain overall strong.

BP reports first-quarter results on May 7.


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