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BP quarterly profit slides
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February 12, 2002: 7:25 a.m. ET
British oil producer sees Q4 revenue hit by economic slowdown, falling oil and gas prices
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LONDON (CNN) - BP, the world's third-largest publicly traded oil company, on Tuesday said fourth-quarter profit fell 46 percent due to a slowing global economy and falling energy prices.
Net income, excluding items, fell to $2.2 billion in the three months to December 31 from $4.09 billion a year earlier. Earnings per share was 9.85 cents compared to 18.25 cents in the fourth quarter of 2000.
The consensus forecast by analysts was for a fourth-quarter net income of $2.09 billion.
BP, along with other major oil and gas companies, has been hit by falling prices as global demand slowed because of a downturn in the economy. More than three quarter of BP's profit came from oil and gas production.
Royal Dutch/Shell, Europe's largest oil company, said last week profit almost halved. Brent crude prices took a tumble after September 11 amid concerns of a global recession. While demand has slowed, crude prices have averaged about $19.40 a barrel in the last three months of 2001, compared with $29.65 a year earlier.
"General economic slowdown, a sharp fall in oil and gas prices certainly made for tough going," Chief Executive John Browne said in a statement.
BP shares rose 1.75 percent to 550.5 pence in early trading on Tuesday in London. The company's stock reached a year high of 652 pence and a low of 478 pence.
BP's future looks more rosy than that of Shell, analysts have said, based on its growth prospects. The company said it replaced with new reserves 191 percent of the oil and gas it produced during the year, well above the 74 percent figure reported by its rival last week.
The London-based company has said it plans to boost oil and gas supplies by an average of 5.5 percent to 7 percent a year. Fourth-quarter net income from its oil and gas production business slumped almost a half to $2.37 billion. Production last year was up 5.5 percent, in line with its target range.
The company said it expects the oil market to steady in the first half of 2002, following the latest round of output cuts by the Organisation of the Petroleum Exporting Countries and non-cartel producers, which helped stem the fall in crude prices.
However, BP said price increases could be limited in the second half of the year if oil producers find it necessary to raise output to meet improved demand as the economy recovers. 
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