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world oil prices drove second-quarter profit down by 53 per cent
compared with a year earlier and saw little sign of growing demand in
the months ahead. Net profit for the period was $4.39 billion,
down from $9.36 billion in the second quarter of last year but better
than market forecasts. It was better than the $2.56 billion profit
reported in the first quarter, when oil prices were in a deep slump.
Oil prices rose off those lows during the second quarter, with
Brent Blend oil averaging $59.13 a barrel in the second quarter
compared to $44.46 in the first quarter - and $121.18 in the second
quarter of 2008. Oil prices sagged early in the year as economies
around the world went into recession, but have risen amid
expectations of at least limited economic recovery later this year.
Chief executive Tony Hayward offered a subdued outlook, saying he
expected energy demand to be sluggish in the near term. 'The
overall picture is of energy demand now stabilizing following
significant falls in the first half of the year,' Hayward said. 'We
see little evidence of any growth in demand and expect the recovery
to be long and drawn out.' Daily production was up 4 per cent
compared to the second quarter last year, with production ramping up
in the Thunder Horse and Dorado fields in the Gulf of Mexico.
Thunder Horse, operated by BP and partly owned by Exxon Mobil, began
producing oil and gas last year, nine years after the field's
discovery. It's designed to produce 250,000 barrels of oil and 200
million cubic feet of natural gas each day, which would make it the
Gulf's largest producer. Replacement cost profit - a key measure
for oil companies which values crude oil and fuel inventories at
current prices - was $3.14 billion in the second quarter, up from $2.4
billion in the first quarter and far below the year-earlier result of
$6.7 billion.
