Oil giant BP said yesterday it suffered a net loss of £893 million ($1.39bn) in the second quarter of 2012. That’s compared with a profit of £3.7bn ($5.9bn) at the beginning of the year.
The firm posted the massive dent in profits as the Gulf of Mexico clean-up continues to soak up cash.
The firm admitted a “weak earnings quarter” because of pay outs as well as a drop in the value of its American shale gas assets, certain refineries in the company’s portfolio and the decision to suspend the Liberty oil project in Alaska.
Bob Dudley, Group Chief Executive said: “We recognise this was a weak earnings quarter, driven by a combination of factors affecting both the sector and BP specifically.”
BP paid £543m in the second quarter alone in costs and litigation relating to the Deepwater Horizon spill in 2010, the largest in US recorded history. It has so far paid around $17.9 billion to the Gulf of Mexico trust for compensation and will pay two further lump sums by the end of 2012.
Mr Dudley added: “Moving into 2013, we expect earnings momentum to build as we complete payments into the Trust Fund, as high-value production comes back on line and as the impact of new projects ramps up.”