BP's net profit more than doubled last quarter, to $3.91 billion from $1.62 billion a year earlier, as the war between the United States and Iran pushed oil and gas prices higher. [1] Revenue reached $70 billion, up 47 percent, and the underlying replacement cost profit the company asks investors to watch came in at $5.7 billion. [1]
The engine was price, not production. Euronews reported that the Middle East conflict roiled energy markets through the April-to-June quarter, and BP was one of five Western majors that together booked close to $47 billion in second-quarter net profit while the fighting continued. [1]
Chief Executive Meg O'Neill, in the job since April, called it "one of the most disrupted periods in the global energy market." [1] Her message to shareholders was contrition rather than triumph. "We are not making the most of our potential," she said. "Our performance over the past few years has not met our own expectations, let alone those of our shareholders." [1]
A doubling of profit does not appear from nowhere. The crude price that lifted BP's margins is the same price refiners pass to drivers and utilities pass to households; the war premium booked as a $3.91 billion line for BP arrives as a larger number at the pump and on the gas bill for everyone who buys energy rather than sells it. That is the mechanics of a windfall: a war moves money from the people buying fuel to the companies selling it.
BP did not credit the war for the result, and O'Neill spent her statement managing expectations. The numbers supply the credit. Profit rose because prices rose, and prices rose because the Middle East was at war. [1]
