BP ups spill cost estimate by $8 billion and profits dive

LONDON (BestGrowthStock) – BP lifted its estimate of the likely cost of its Gulf of Mexico oil spill by $7.7 billion to $39.9 billion on Tuesday, pushing its profits down sharply in spite of higher oil and gas prices.

BP, the world’s biggest non-government controlled oil company by production last year, said delays in capping its blown out well prompted the increased charge for ending the leak, cleaning up the damage and compensating those affected.

BP said third-quarter replacement cost profit, which strips out unrealized gains or losses related to changes in the value of fuel inventories, fell 63 percent to $1.8 billion.

Stripping out one-offs, including the oil spill costs, the underlying results rose 18 percent to $5.53 billion, well ahead of an average forecast $4.60 billion from a Reuters poll of seven analysts.

BP ups spill cost estimate by $8 billion and profits dive