BP Plc, the world's second-largest listed oil company, reported slightly lower-than-expected oil output and higher costs for the fourth quarter, prompting some analysts to lower earnings forecasts. BP said on Wednesday it produced 4.09 million barrels of oil equivalent per day (boepd) in the fourth quarter, almost 100,000 below some forecasts, although it cheered investors with signs of a keenly awaited recovery in non-Russian production. "Overall the statement is a bit negative, but ... 2005 should see a return to strong growth excluding Russia," investment bank CSFB said in a report.
Low-margin production in Russia has driven BP's output growth in the past year. Investors are keen to see BP delivering on big, higher-margin projects in Africa and the Gulf of Mexico.
The company added that exploration and interest costs would be higher than in the third quarter and that it would take $2.3 billion in charges. Some $2 billion of this was related to a petrochemical unit spin-off and was largely anticipated.
Cazenove downgraded its fourth-quarter earnings forecast by 2.2 percent after the trading statement, while other analysts said they were recalculating their forecasts with a view to lowering them.
Merrill Lynch, however, raised its forecast by $100 million on the back of BP's strong downstream result.
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