$MCADE presale is now live!

BP CEO on Q2 results: “oil demand will return to pre-pandemic levels in 2022”

By:
on Aug 3, 2021
Listen to this article
  • British Petroleum's profit exceeded expectations in the second quarter.
  • BP raised dividend and expanded stock buyback for fiscal Q3.
  • CEO Bernard Looney discusses earnings on CNBC's "Squawk Box".

British Petroleum (LON: BP) announced a $1.40 billion share repurchase for the third quarter on Tuesday and raised its dividend to 5.46 cents per share as earnings exceeded expectations in Q2. BP now expects a 4% increase in annual dividend through 2025 and roughly $1 billion of stock buyback per quarter, estimating oil price to average at $60 per barrel.  

Bernard Looney’s comments on CNBC’s “Squawk Box”

According to CEO Bernard Looney, it was the higher commodity prices, an improving balance sheet, and strong underlying performance that drove the confidence to increase the return to shareholders. On CNBC’s “Squawk Box”, he said:

Are you looking for fast-news, hot-tips and market analysis? Sign-up for the Invezz newsletter, today.

“We are seeing a slight muting of oil demand because of the delta variant, but I wouldn’t say it’s material yet. As we look forward, we see oil demand returning to pre-pandemic levels in 2022. There are uncertainties that remain, but the OPEC+ discipline, their desire and their capacity to keep prices in the range where we see them today is quite strong. All of that bodes well for a reasonable outlook for oil prices over the coming years.”

Second-quarter financial performance

British Petroleum reported $2.8 billion of underlying replacement cost profit versus the year-ago figure of $6.7 billion in loss. According to Refinitiv, analysts had called for $2.06 billion of net profit in the second quarter after $2.6 billion in Q1.  

The oil giant valued its operating cash flow at the end of the second quarter at $5.4 billion as net debt shrunk to $32.7 billion. With eight new projects and cost savings from a major restructure that slashed over 6,000 jobs, BP now expects production to see an increase in Q3.  

Earlier this year in May, Barclays chose British Petroleum as a top pick. Shares of the London-based multinational that has a market cap of $86 billion closed more than 5% up on Tuesday.