Middle-east Arab News Opinion | Asharq Al-awsat

Britain’s BP Sees Oil Output Fall for Sixth Quarter | ASHARQ AL-AWSAT English Archive 2005 -2017
Select Page

LONDON (AFP) -BP, the world’s second largest oil company, has said that its energy production dropped by five percent in the final three months of 2006, the sixth quarterly drop in a row.

In a trading update on Tuesday, BP said it pumped 3.82 million barrels of oil and gas per day in the fourth quarter compared with 4.02 million barrels during the same period a year earlier owing to supply disruptions in Alaska, a cut in output by OPEC oil-producing cartel and weak demand for gas.

Analysts had expected fourth-quarter output in the region of 4.0 million barrels of oil equivalent per day (mboed).

BP’s share price slumped about 2.0 percent in response to the data.

Excluding volumes from its Russian joint-venture TNK-BP, the group’s production was around 2.89 mboed per day in the fourth quarter.

BP said it was hit in the final three months of 2006 “by weather related delays to Alaskan loadings, unusually low seasonal gas demand, OPEC quota restrictions, and reduced entitlements under production sharing contracts”.

By contrast, output was supported by a resumption in production after the summer maintenance season, mainly in the North Sea and Alaska, and new projects in Azerbaijan and North Africa.

During the third quarter, BP had been forced to partially shut Alaska’s Prudhoe Bay — the largest oil field in the United States — owing to severe pipeline corrosion. This resulted in delays to BP’s fourth-quarter output.

BP meanwhile added that the average price of Brent North Sea crude oil dropped by 10 dollars in the fourth quarter, compared with the previous three-month period, to 59.60 dollars per barrel.

However it was up compared to the fourth quarter of 2005, when the average Brent price stood at 56.87 dollars per barrel.

World oil prices have continued to slump since the start of 2007, falling under 55 dollars last week, owing to warmer winter temperatures in the United States, which has dampened demand for heating fuel.

BP, which is due to publish its full-year results on February 6, could still post record annual profits, however, after oil prices struck record high points above 78 dollars per barrel last July owing to rising tensions in oil producing nations and disruption to Prudhoe Bay output.

In early deals, the share price in BP fell 1.99 percent to 541.50 pence on the FTSE 100. The capital’s leading share index rose 0.30 percent to 6,212.70 points.

“There were no major surprises” in BP’s release, said an analyst at one leading brokerage.

BP “just confirmed the disappointments we’re expecting”.