BP lost two-thirds of its profit during the first quarter of 2020.
Besides the lost profit, the company is facing significant debt, reaching numbers unseen for more than five years, after the pandemic slashed the Oil demand.
The energy giant, BP, said that earnings fell in Q1 to $628 million from $2.10 billion from the period last year. The cost-profit also dropped to $800 million. However, it is bigger than the consensus of $710 million.
From the $67.41 billion same period last year, the revenue fell to $59.54 billion, while the net loss was $4.37 billion.
The production fell to 2.58 million barrels per day, a drop of 2.9%.
For the second quarter, BP expects the output to be even lower: it all depends on how OPEC+ takes care of the situation, and on how the pandemic will develop further.
The share price lost 1.5% during the morning trade, with an overall drop of 35% since the beginning of the year.
To see the impact the pandemic and the low oil demand had on the market, we can take two of the biggest drilling companies in the world as an example:
Diamond Offshore filed yesterday for bankruptcy. The company’s revenue fell 12% under $1 billion. In just one year it lost twice as much as it did two years ago. But Diamond Offshore is not the first to go bankrupt, Whiting Petroleum did this at the beginning of the month. The collapse came once the Oil price reached $20 per barrel.
No one knows what to expect as Oil just partially rebounded from a negative historic drop just a week ago when the futures contracts traded at -$37.63 per barrel. Yesterday alone, it lost more than 25% to $12.57.
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Sources: edition.cnn.com, marketwatch.com, investing.com, cnbc.com
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