BP raises dividend despite drop in oil price, Russia


Oil major BP increased dividends in the third quarter as it saw a jump in operating cash flow despite lower oil prices and a steep drop in contributions from Russia where a depreciating ruble hit its income.

Andrey Rudakov | Bloomberg | Getty Images

BP's said its underlying replacement cost profit for the quarter was $3.0 billion, broadly in line with expectations of $2.948 billion in Reuters Smartestimate. That was down 21.5 percent year on year.

The dividends for the third quarter will rise by 5.3 percent year on year to 10 cents per ordinary share while organic capital expenditure for the full year will be trimmed to around $23 billion from previous guidance of $24-25 billion.

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"Growing underlying production of oil and gas and a good downstream performance generated strong cash flow in the third quarter, despite lower oil prices. This keeps us well on track to hit our targets for 2014," BP Chief Executive Bob Dudley said in a statement.

BP, a major investor in Russia through a stake in state oil major Rosneft, said the depreciation of the ruble against the dollar over the period had a significant impact on results.

It said its underlying net income from Rosneft for the quarter was $110 million compared with $808 million a year earlier.

However, BP's overall operating cash flow for the quarter was $9.4 billion compared with $6.3 billion a year earlier as the downstream segment saw underlying pretax replacement cost profit more than doubling year on year to $1.5 billion.

The upstream segment saw a fall in underlying pretax replacement cost profit to $3.9 billion from $4.4 billion on lower oil production volumes and prices.

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