BP warned on Tuesday of a “ slow and gradual” recovery in its US and European markets as the oil company disappointed investors with its fourth-quarter results. Although the results were seen as stronger than the 2009 earnings of peers ExxonMobil and Chevron, BP’ s 70 per cent rise in underlying profits was less than analysts had expected. BP said oil and gas production this year would be lower than in 2009, after reporting 4 per cent growth for last year. Tony Hayward, the chief executive who has led a drive to cut costs and raise efficiency since taking over in 2007, said 2009 had been one of the best for the company since the merger with Amoco of the US in 1998.
For the full year, post-tax profit was $14bn, down 45 per cent from the record profit of $25.6bn in 2008, as a result of the fall in oil and gas prices, and a squeeze on profit margins in refining. Exxon’ s full-year profit was down 57 per cent, and Chevron’ s down 56 per cent.
Mr Hayward said: “ These results provide the clearest demonstration of the progress we have made and the momentum we have established in growing our business and making it more efficient.” BP has cut 7,500 jobs, from a workforce of 98,000 at the end of 2007, and transferred out 10,000 by selling its US service stations. Cash costs were $4bn lower for 2009 than in 2008.
BP said Opec, the producing countries’ cartel, would support the oil price, but it expected “ gas markets to remain volatile and refining margins to remain depressed”. The business reported good growth in production as projects, including the flagship Thunder Horse platform in the US Gulf of Mexico, ramped up. Average production for 2009 was just under 4m barrels of oil equivalent per day, up 4 per cent on 2008, and although this year’ s production is expected to be lower, growth is expected to resume in 2011. BP said it booked replacements to its oil and gas reserves equivalent to 129 per cent of its production.