BP has signalled a "broadly flat" oil and gas output forecast for the third quarter, whilst bracing for a squeeze on profits due to diminishing refining margins.
The energy major also anticipates an uptick in net debt, predominantly attributed to less robust refining margins and the rephasing of approximately $1bn (£766m) in divestment proceeds expected in the fourth quarter.
In its latest trade update, BP has flagged an anticipated hit to third-quarter profits in the range of $300m to $400m stemming from severely contracted refining margins.
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Furthermore, the firm predicts weaker performance in oil trading activities, as reported by . Its oil production and operations segment is poised to endure an "unfavourable impact" estimated at $100m to $300m compared with figures from the preceding quarter, along with potential additional detractions amounting to $200m to $300m from escalated exploration write-offs.
This news arises amidst a broader trend of decelerating profitability within the sector, trailing the surge of post-pandemic gains.
Shell disclosed a near one-third reduction in refining profit margins for the third quarter this Monday, with waning global demand contributing to the downturn. Last week, Exxon Mobil, the American oil behemoth, cautioned that a slump in the value of oil might impinge upon their third-quarter earnings.
Conversely, in its gas and low carbon energy division, BP expects that realizations are likely to have a positive quarter-on-quarter effect of roughly $100m. Year-to-date, BP's shares have plunged by over 12%.