BP has reported a loss of $5.69bn (£4.15bn) for last year after a collapse in global oil demand during the Covid-19 pandemic, compared with a profit of almost $10bn in 2019, says an article published in The Guardian.
Tumbled Prices
The company’s first full-year financial loss in a decade came after the industry was “hit hard” by the pandemic, which triggered a collapse in demand for transport fuels, and caused oil prices on the global market to tumble.
Long-term Expectations
BP was forced to write off the value of its oil and gas assets by a total of $6.5bn last year as the industry slashed its expectations for oil prices over the long-term. It also cut its global workforce by 10,000 and reduced its shareholder dividend for the first time since the Deepwater Horizon disaster.
Challenging year
In the final quarter of a “challenging” year for BP, it reported a modest underlying profit of $115m, which was well below analyst forecasts of a $360m profit and a fraction of the $2.5bn reported for the same months in 2019.
Major oil companies struggled last year as coronavirus restrictions kept a lid on slowly rising global oil prices, which have been kept afloat by a pact between the Opec oil nations to limit oil production.
The BP chief executive, Bernard Looney, said 2020 would “be remembered for the pain and sadness caused by Covid-19”, but was also a pivotal year for BP.
Zero Carbon Targets
The company bowed to growing pressure to act on its climate impact by setting a target to become a net zero carbon company by 2050, and has set in motion plans to cut its costs and reduce its debt.
BP is more than half way towards its target to sell off $25bn-worth of assets by 2025, and expects divestments worth between $4bn to $6bn in the year ahead. The sales are expected to help pay off BP’s net debt, which fell to $39bn at the end of 2020, down $1.4bn over the quarter and $6.5bn over the full year.
“We expect much better days ahead for all of us in 2021,” Looney said.
Did you subscribe to our daily newsletter?
It’s Free! Click here to Subscribe!
Source : The Guardian
