BP has reported a drop in profit for the first quarter of the year and higher net debt amid lower oil prices.
The UK oil major reported underlying replacement cost profit of $2.7bn (£2.2bn) in the first quarter, compared to $3bn (£2.4bn) in the fourth quarter of 2023 and $5bn (£4bn) in the first quarter of 2023.
The group also saw net debt increase to $24bn (£19.1bn) from $20.9bn (£16.7bn) in the fourth quarter of 2023.
It also reported adjusted earnings before interest, tax, deprecation and amortisation (EBITDA) of $10.3bn (£8.2bn) compared to $10.6bn (£8.5bn) in the fourth quarter of 2023 and $13bn (£10.4bn) for the first quarter of 2023.
BP said lower earnings reflected lower oil prices as well as the impact of operational outages on production and weaker profit margins in its fuels segment.
The company also laid out plans to deliver at least $2bn (£1.6bn) in cost savings by the end of 2026.
Murray Auchincloss, chief executive officer said: “We’ve delivered another resilient quarter financially and continued to make progress on our strategy. Oil production was up and our ACE platform in the Caspian is now producing.
“We are simplifying and reducing complexity across bp and plan to deliver at least $2bn (£1.6bn) of cash cost savings by the end of 2026 through high grading our portfolio, digital transformation, supply chain efficiencies and global capability hubs,” Auchincloss added.
Despite the fall in underlying profit and higher net debt, BP has announced another share buyback. The company said it has authorised a $1.75bn (£1.4bn) share buyback for the first quarter as part of its commitment to return $3.5bn (£2.8bn) in the first half of 2024.
Kate Thomson, chief financial officer, said: “BP reported solid financial performance in the first quarter with adjusted EBITDA* of $10.3bn (£8.2bn) and underlying replacement cost profit of $2.7bn (£2.2bn). Our financial frame is unchanged, and we are delivering competitive shareholder distributions, announcing a $1.75bn (£1.4bn) share buyback for the first quarter as part of our commitment of $3.5bn (£2.8bn) for the first half of 2024.”