BP warns that weak margins in refining will hit Q3 profits

BP has said that a decline in the refining margins will reduce its third quarter profit by $400 to 600 million dollars compared to the previous three-month period.

In a press release, the British group said that it also expects its oil trading results to be poor.

Oil refineries around the world are experiencing a decline in profits that is at a multi-year low. This marks a downward turn for an industry which had seen a surge in returns following the pandemic. It also highlights the global slowdown.

Rival Shell warned on Monday of a slump in refinery profit margins as well as weak oil product sales in the third quarter.

Exxon Mobil, the U.S. oil giant, said in a statement last week that the slump in oil prices would hit its third-quarter profits.

The third quarter saw oil prices fall by 17%, the biggest quarterly drop in a decade, due to concerns about global demand. Brent futures closed at $71.77 per barrel on the final trading day of the third quarter.

BP stated that the third quarter result of its oil production and operations division will be affected by $100 to $300 million. Reporting by Arunima Kumar in London, Editing by Jan Harvey & David Evans

(source: Reuters)