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BP profits take a hit

February 3, 2015

UK-based BP has booked quarterly losses as the energy giant keeps struggling with sliding oil prices. The company also took a further hit from legal costs relating to the 2010 Gulf of Mexico oil spill.

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BP logo BEN STANSALL/AFP/Getty Images
Image: Ben Stansall/AFP/Getty Images

Oil giant BP on Tuesday reported a $4.4-billion (3.9-billion-euro) loss for the fourth quarter of 2014. Bottom-line income figures included a$5-billion write-down on the value of the company's inventories after the price of Brent crude dropped almost 40 percent last year.

The dip in earnings came on the back of a $1.04-billion profit in the same quarter a year earlier. BP CEO Bob Dudley hinted a fresh start had to be made.

"The company's focus must now be on resetting BP; managing and rebalancing out capital program and cost base for the new reality of lower prices," Dudley said in a statement.

Shifting into lower gear

The company was also hit by lower earnings at Russian energy firm Rosneft in which BP holds a 20-percent stake. BP took a further hit of $477 million from the legal and clean-up costs relating to the 2010 Gulf of Mexico oil spill, bringing total charges for the disaster to $43.5 billion.

BP announced it would slash investment this year, mirroring the situation across the sector. Spending in 2015 was expected to total $20 billion, down from a previous guidance of $24-26 billion.

"We have now entered a new and challenging phase of low oil prices through the near and medium term," Dudley said, adding that reliable, safe and efficient operations were a priority.

hg/pad (AP, AFP)