Introduction

Oil major BP has announced a significant decline in second-quarter profits due to weaker fossil fuel prices, reflecting a widespread trend in the energy industry.

Financial Results

BP’s second-quarter underlying replacement cost profit, used as a proxy for net profit, reached $2.6 billion. This figure fell short of analysts’ expectations of $3.5 billion.

Comparing the second-quarter profit with previous periods, BP recorded $4.96 billion in the first quarter of the year and $8.5 billion in the second quarter of 2022.

Industry Trends

Oil majors, including BP, have struggled to achieve the extraordinary profits seen during the same period last year due to the decline in commodity prices.

Other major energy companies such as Shell and TotalEnergies reported a substantial drop in second-quarter profit, while Exxon Mobil experienced a 56% year-on-year decline.

In 2022, the five largest oil companies in the West collectively earned nearly $200 billion in profits, boosted by surging oil and gas prices following Russia’s invasion of Ukraine. BP itself reported a record profit of $27.7 billion for the full year of 2022.

Market Challenges

The first half of this year witnessed a decline in oil and gas prices due to global economic uncertainties outweighing supply-demand fundamentals.

Despite these challenges, BP’s shares have seen a modest increase of approximately 1.7% year-to-date.

Conclusion

This breaking news will be updated as more information becomes available.