BP still in the red but recovery in crude prices provides end-of-year boost

Oil giant BP remained in the red with losses of 999 million US dollars (£803 million) in 2016, but revealed a year-end boost as crude prices bounced back.

The group clawed its way out of the red in the fourth quarter, with profits of 72 million US dollars (£58 million) against losses of 2.2 billion US dollars (£1.8 billion) a year earlier.

This helped annual losses improve from the mammoth 5.2 billion US dollars (£4.2 billion) loss posted in 2015, which was its worst result for at least 20 years.

On an underlying basis, BP saw profits more than halve in 2016 to 2.59 billion US dollars (£2.1 billion) from 5.91 billion US dollars (£4.8 billion) the previous year.

BP said oil prices remained "challenging" in 2016, with the average for Brent crude standing at 44 US dollars a barrel - the lowest for 12 years.

Recent higher oil prices, which have recovered above 50 US dollars a barrel, helped underlying replacement cost profits more than double to 400 million US dollars (£322 million) in the fourth quarter from 196 million US dollars (£158 million) a year earlier.

But this was lower than City forecasts for around 560 million US dollars (£450 million).

The group said it expected to balance its books at an oil price of around 60 US dollars a barrel by the end of 2017 and hopes production to rise this year, although it cautioned over the impact of Opec's decision to cut production.

Bob Dudley, BP group chief executive, said: "We have delivered solid results in tough conditions - and are well prepared for any volatility in oil pricing."