By Adam Whittaker


BP said it expects to book impairments of $1.0 billion to $2.0 billion in the fourth quarter while upstream production is expected to fall.

The British oil-and-gas giant said on Tuesday that the non-cash, post-tax charges are attributable across its business divisions.

In a trading update covering the final three months of last year, BP said upstream production is expected to be lower than the 2.4 million oil-equivalent barrels a day it reported in the third quarter.

Lower oil prices and refining margins also look set to continuing dragging on BP's financial results--a fourth-quarter theme analysts expect across the sector.

Last week, BP's London-listed peer Shell also cut production guidance across its oil and gas segments and reported an unchanged low refining margin.

For the period, BP saw average Brent Crude prices of $74.73 a barrel, down from $80.34 a barrel in the third quarter. Meanwhile, BP's average refining marker margin fell to $13.1 a barrel, down nearly $3.50 a barrel from the previous quarter.

However, slightly higher gas prices are expected to marginally soften the financial hit from lower oil prices.

For the full year, BP said it expects a larger hit from foreign-exchange losses than previously guided for. It now expects an annual charge of around $6.0 billion, up from previous guidance of $0.3 billion to $0.4 billion.

As a result of the update, analysts at RBC Capital Markets lowered their fourth-quarter net income estimate to $1.31 billion, from $1.63 billion.

In the update, BP also said Chief Executive Murray Auchincloss recently underwent a planned medical procedure and will return to the office by February.

As a result, its capital markets event will now take place on Feb. 26 in London. It was previously scheduled for Feb. 11 in New York. Its fourth-quarter and full-year results are due to be published Feb. 11.


Write to Adam Whittaker at adam.whittaker@wsj.com


(END) Dow Jones Newswires

01-14-25 0432ET