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BP results boosted by rise in price of oil

BP Plc said yesterday that second-quarter profit rose 71 percent compared with the previous quarter as oil prices rose. The result beat market forecasts, but was still less than half what the oil company earned a year earlier.

Net profit for the period was US$4.39 billion compared to US$2.56 billion in the first quarter. Profit fell, however, from the US$9.36 billion in the second quarter of last year.

Oil prices rose during the quarter after a steep fall in the early part of the year.

Brent Blend oil averaged US$59.13 a barrel in the second quarter compared to US$44.46 in the first quarter and US$121.18 in the second quarter of 2008.

Oil prices sagged early in the year as economies around the world went into recession, but prices have risen amid expectations of a limited economic recovery later this year.

Chief Executive Tony Hayward said he expected energy demand to be sluggish in the near term. Daily production was up 4 percent compared to the second quarter last year, with production ramping up in the Thunder Horse and Dorado fields in the Gulf of Mexico.

"The overall picture is of energy demand now stabilizing following significant falls in the first half of the year," Hayward said. "We see little evidence of any growth in demand and expect the recovery to be long and drawn out."

BP, the first of the major oil companies to report earnings for the second quarter, said its dividend of 14 cents per share for the quarter was unchanged from last year.

BP said it had cut its cash costs by US$2 billion in the first half of the year compared to 2008, hitting its full-year target early, and said it expected to achieve savings of more than US$3 billion by the end of the current year.


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