BP announced on Tuesday that its profit for the first quarter went down, falling short of what analysts expected. This drop was mainly because of lower profit margins on fuels and lower prices for gas and oil.
The British energy company made a profit of $2.7 billion, which is less than the $3 billion it made in the previous quarter. Analysts expected it to make $2.9 billion. BP explained that this drop was because they were making less money from selling oil and gas, and the profit margins on fuels were much lower.
Compared to the same time last year, BP’s profits are much lower. In 2023, they made nearly $5 billion. Other big companies in the oil and gas industry are also seeing their profits go down compared to last year because gas prices have dropped sharply.
During this winter, European countries stored a lot of gas because they were worried about not getting enough from Russia after Russia invaded Ukraine in 2022.
BP’s rival, Shell, announced last week that it made $7.7 billion in the first three months of this year, which is less than the $9.6 billion it made last year.
Despite the lower profits, energy companies are still focused on giving money back to their shareholders. BP said it would buy back $3.5 billion worth of shares in the first six months of 2024.
The CEO, Murray Auchincloss, said that even though the quarter wasn’t great, BP is still doing okay. He mentioned that the company is working on making its business simpler to save $2 billion by 2026.
BP appointed Auchincloss as the permanent CEO in January. The previous CEO, Bernard Looney, quit after less than four years because of personal relationships with colleagues before he became CEO.
