BP sees up to $5bn in Q4 impairments

(Sharecast News) - Energy giant BP on Wednesday said it expected to take an impairment charge of $4bn - $5bn in ‌the fourth quarter, mainly ‌related to its energy transition ‌businesses, while oil trading was expected to be weak. Group oil and gas production in the fourth quarter was expected to be broadly flat compared to the prior quarter, with production broadly flat in oil and lower in gas & low carbon energy.

BP added that the impairments would not ‌impact underlying replacement cost profit - the company's equivalent of net income. The company has pivoted away from greener energy to fossil fuels.

The gas & low carbon energy segment was expected to take a hit of up to $300m, including changes in non-Henry Hub natural gas marker prices. The gas marketing and trading result was expected to be average.

Oil production operations were expected to be impacted by up to $400m, including the impact of the price lags on BP's production in the Gulf of Mexico and the UAE.

Reporting by Frank Prenesti for Sharecast.com