At BP’s 2016 AGM Bob Dudley was optimistic about the company’s future despite headline loss of $6.5 billion.
Bob Dudley, Chief Executive, BP, said: “We’re a company that is constantly adapting and evolving. But last year we had to respond again and redouble our efforts. The oil price kept on falling and we’ve drawn on BP’s distinctive ability to adapt and move quickly.
“Our underlying profit of $5.9 billion was 50% down on 2014 – as you might expect with oil prices also down by half year-on-year. But our underlying cash flow remained strong at over $20 billion – and our cash costs were down by $3.4 billion on 2014.
“This progress continues and we’re on course for our cash costs to be nearly $7 billion a year lower by the end of next year compared with 2014.
“You will know that our headline result was a loss of $6.5 billion. I think it’s very important to recognise that this figure to a large extent results from a one-off charge relating to $18.7 billion settlement of all federal and state claims arising from the Gulf of Mexico accident and oil spill.
“The actual payments arising from the settlement will be spread over nearly 20 years and this leaves us able to focus more clearly on the future.
“In the Downstream, we had a great year – in fact a record year. Of course, we could expect a lift in the downstream because a lower oil price means a lower cost of raw materials. But what Tufan Erginbilgic and his team have achieved goes way beyond that.
“Their action to simplify and streamline the business brought down cash costs by more than 15% compared with 2014. Year-on-year our fuels earnings grew 11% and our lubricants went up 20% – at constant currencies – and we grew our petrochemicals earnings by over $200 million.
“All of which contributed to record Downstream earnings in 2015 of $7.5 billion pre-tax.
“Right now, I believe we are generating real momentum in a very challenging environment. We have been through such challenges before – and we will come out stronger. So while conditions are tough today, we are well placed to go on delivering energy for decades to come.”