BP Surprised by $7.2b Q1 Profit

Edward Niedermeyer
by Edward Niedermeyer
We’re committed to finding, researching, and recommending the best products. We earn commissions from purchases you make using links in our articles. Learn more here
bp surprised by 7 2b q1 profit

With gas heading for $10/gal (maybe), automakers aren't raking in the bucks. But oil companies are. Marketwatch reports that British Petroleum and Royal Dutch Shell both released 1Q profit numbers yesterday, and the results would make any automaker drool a little. BP made $7.2b in the last three months, beating analysts expectations by over a billion bucks. Shell boasts a whopping $9.08b in profit this quarter, also beating market expectations by over a billion. Neither BP nor Shell increased production by more than one percent; they received between 52 and 66 percent more per barrel sold than last year. Even the oil companies are scratching their heads– all the way to the bank on these numbers. "We don't understand the oil price at this stage," Shell CFO Peter Voser tells The International Herald Tribune . "The fundamentals will not justify an oil price as we see it at the moment." Voser added that Shell "was not investing money in projects that would require oil prices to remain high to be profitable." (That's the job of SUV makers.) ExxonMobil and Chevron are expected to announce their own knee-weakening profits later this week.

Edward Niedermeyer
Edward Niedermeyer

More by Edward Niedermeyer

Join the conversation
4 of 26 comments
  • LenS LenS on Apr 29, 2008

    It seems that we're doomed to repeat the 70's. Too many voters and politicians are either too young to have lived then or have had 30 years to forget (or rewrite in their memories) or thought that America in decline was/is a good thing. So we probably get to repeat the stupidities of the past again. Go ahead, zap the oil company profits. Then watch investment in new fields and infrastructure drop since the publicly held Western oil companies are the ones who actually do the hard work of finding and developing our future oil supplies. Or just try to mandate lower prices and watch dictators like Putin, Chavez and the House of Saud laugh as they sell their oil for a higher price to non-US customers. I just can't wait for the next President to tell us that we need to accept our misery.

  • Boosterseat Boosterseat on Apr 30, 2008

    Wow, this sure went off topic. Do the math - 2,000,000 barrels /day @ $115/barrel. That's per day folks. When oil went from $75 to $115, that $40 increase is all profit(-royalties), the costs are fixed. I am hapy to have about 35% of my money in oil/nat gas stocks and do you know what... my biggest concern is that they will not raise the dividends fast enough! Few appreciate that it is a cruel witch of a business. The companies produce something vital. Prices fluctuate wildly and are out of their control. When prices are low management takes flack for investing too much in exploration. When prices are high, they are called gouging crooks(see previous wacky posts). With constantly changing financials, gov't regs and natural disasters, it is one of the most difficult industries. I say join the fun by buying stock on their down cycles, then ride the wave or sell on their up cycles. You are going to buy gas anyways right? This way at least you are reimbursed when the pump price increases.

  • Windswords Windswords on Apr 30, 2008

    marc: @pfinst "maybe because oil execs use their billions to buys yachts and mansions and the govt uses gas taxes to pay for things like, o i dont know, roads and bridges???" yea, they build a bridge to nowhere and fund things like studies of cow farts (hey it might cause "global warming"). Somewhere out there is a government grant (that means your money is paying for it) to fund a museum of glass soft drink bottles. Give me time and I could come up with a reasonable budget of less that 2 trillion that would adequately fund everything the country needs. This years budget is what, 3.1 TRILLION! And it doesn't matter which party is in control. I'd rather give it to the oil companies. At least they might use for something good, like finding more oil. Ask yourself this question: if the oil companies want the price to go up because of a shortage of oil then why are they always begging the congress to be allowed to drill for more oil and to build or expand refineries? Shouldn't they just shut up and collect the money? Instead they want to drill in ANWR, in the gulf, off the coast of FL and CA, but congress won't let them. And they want to get more refining capacity but it takes 10, 15, 20 years and millions of dollars to just get the freaking approval. We deserve the government that we get.

  • Landcrusher Landcrusher on Apr 30, 2008

    Joe SS, Good question. Exxon and Shell are very government like, and Chevron is trying to play that way. The rest as I can tell, are much more business like. Surprisingly, that includes BP. The BP people around here have a reputation of being the most mission oriented and least bureaucratic of all the large oil companies. Still, when I use "Big Oil" I do it like the NYT. Big Oil is every company with more than one well or station. The vast majority of oil companies are little different from others of similar size.