The oil giant also announced that it would cut 7,000 jobs by the end of 2017 – nearly 10% of its global workforce.
BP’s underlying fourth-quarter profits sank to $196m, compared with $2.2bn for the same period in 2014 and far worse than analysts had expected.
The company plans to cut 3,000 jobs in its downstream division by the end of 2017, on top of 4,000 cuts in its oil and gas production business announced last year.
BP’s results are the latest to show the extent large oil companies are struggling following a 70% collapse in crude oil prices since the middle of 2014 that has forced them to cut tens of thousands of jobs and slash spending.
Benchmark Brent oil prices averaged $43 a barrel in the fourth quarter of 2015, down from $76 a year earlier. The poor market backdrop is set to persist with Brent averaging about $33 per barrel in 2016 so far.
Bob Dudley, BP group chief executive, commented: “We are continuing to move rapidly to adapt and rebalance BP for the changing environment. We’re making good progress in managing and lowering our costs and capital spending, while maintaining safe and reliable operations and continuing disciplined investment into the future of our portfolio.
Tomorrow (3 Feb 2016) Shell is expected to report its latest results, which analysts are also expecting to show a 50% fall in its profits.