BP turned an unexpected profit in the first quarter due in part to its refining business. The British oil giant said today its downstream segment reported an underlying pre-tax replacement cost profit of $1.8 billion, up from $1.2 billion in the fourth quarter of 2015. BP said lower costs, strong refining operations and an improved supply and trading contribution propelled its downstream business despite relatively weak refining margins and lower seasonal fuel demand.
Bloomberg notes that analysts expected BP to post a loss of $244.9 million in the first quarter. Indeed, BP’s upstream segment lost $747 million in the quarter as Brent crude prices averaged $34 per barrel. The positive downstream results along with reduced costs and spending cuts helped the company beat expectations.
BP owns three U.S. refineries, located in Whiting, Indiana; Toledo, Ohio; and Cherry Point, Washington.
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