Sign of the times: BP said it expects a slump in refining margins to take a £306m to £459m chunk out of its third-quarter profit
A global slowdown in the demand for fuel has hit BP’s refining business.
The oil major said it expects a slump in refining margins to take a £306m to £459m chunk out of its third-quarter profit.
The company also warned oil trading was ‘weak’ in the three months to the end of September.
BP follows Shell in reporting a drop in margins after their refining businesses suffered a downturn in global demand recently across both consumer and industrial sectors.
Economic slowdowns in major economies including China, along with a growth in electric car sales, have contributed to the fall. Refiners have enjoyed bumper profits driven by supply shortages caused partly by Russia’s invasion of Ukraine.
BP and Shell’s US rival Exxon Mobil also flagged last week that lower oil prices and refining margins in the most recent quarter will likely hit its profits for the period.
BP said its oil production and operations business would also be impacted by lower prices, to the tune of about £76m to £229m. However, BP upgraded its upstream production guidance for the third quarter.
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