Oil major BP posts 70% drop in second-quarter profit, raises dividend by 10%

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LONDON — Oil major BP on Tuesday reported a nearly 70% year-on-year drop in second-quarter profits on the back of weaker fossil fuel prices, echoing a trend observed across the energy industry. The British energy major posted second-quarter underlying replacement cost profit, used as a proxy for net profit, of $2.6 billion. Analysts had expected BP to report second-quarter profit of $3.5 billion, according to estimates collated by Refinitiv. The second-quarter result compared with a profit of $4.96 billion recorded in the first three months of the year and with the $8.5 billion logged in the second quarter of 2022. BP said the earnings reflected significantly lower realized refining margins, a higher level of turnaround and maintenance activity and a weak oil trading result. Nonetheless, the energy giant boosted its dividend by 10% to 7.27 cents per ordinary share for the second quarter. BP also said it would repurchase $1.5 billion of its shares over the next three months. "A very good quarter and that has given the board … the confidence to announce a $1.5 billion buyback program for the quarter and additionally we've raised the dividend by 10%," BP CEO Bernard Looney told CNBC's "Squawk Box Europe" on Tuesday. "So, all in all, we're doing what we said we would do which is performing while transforming and we're very pleased with the results," he added. Shares of London-listed BP rose 0.6% during early morning deals. Oil majors have failed to match the bumper profits posted during the same period of last year amid weaker commodity prices. British rival Shell and French oil major TotalEnergies on Thursday reported a steep drop in second-quarter profit, while U.S.-based Exxon Mobil's second-quarter profit slumped 56% year-on-year.