BP benefitting from gas price crisis with $500m trading bonanza
BP’s trading team made at least $500 million in Q3 2021, according to Reuters.
The energy giant’s gas trading results were reportedly disclosed at an internal call with staff earlier this month.
It has benefitted from a gas crisis that has left embattled consumers and industries struggling with rising costs.
Natural gas and power prices have soared across Europe and Asia, as the global economy recovered from the pandemic and energy consumption increased faster than supplies.
BP’s strong showing in the third quarter could be an early indication on how Shell and Equinor will also benefit from the global gas crunch, who will report results this and next week respectively.
The firm has a smaller LNG and gas trading book than its rivals.
Shell has already forecast a post-quarterly revenue of £1.5bn for its natural gas division, ahead of its announcement on Thursday.
BP needs trading to generate profit while it shifts to renewable and power markets, that tend to have lower margins than oil and gas.
Its trading arm made nearly $4 billion in 2020 in profits, almost equalling the record trading profit in 2019.
The sector is now under increasing pressure to invest more in renewables, with governments set to meet in Glasgow for the COP26 climate conference later this week.
BP is committing to 2050 as its net zero carbon emissions target, and has also announced plans to increase low carbon investments tenfold by the end of the decade.
The company has pledged to cut oil and gas output, while Shell says its oil production has peaked.
Shell is aiming for carbon footprint cuts of 20 per cent by 2030 and 100 per cent by 2050 for all its products.
Both firms are still expanding trading and make billions of dollars a year moving oil and gas around the world.