BP to take up to $2bn in impairments in Q2, sees flat production

(Sharecast News) - BP said it would take a hit of up to $2bn in the second quarter relating to asset impairments and onerous contract provisions, while its oil-trading result was also set to be weaker compared with the prior three months. The writedown includes charges relating to the ongoing review of its Gelsenkirchen refinery in Germany, BP said on Tuesday.

"Significantly lower" realised refining margins were expected to have an adverse impact in the range of $500 - 700m mainly relating to weaker middle distillate margins and narrower North American heavy crude oil differentials, and a higher level of turnaround activity.

The oil and gas giant also forecast flat upstream production in the second quarter, while its gas marketing and trading result was also expected to be average following a strong result in the first quarter.

Upstream production in the second quarter is now expected to be broadly flat compared to the prior quarter, with production broadly flat in oil production & operations and slightly lower in gas & low carbon energy.

Reporting by Frank Prenesti for Sharecast.com