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BP profits fall amid oil price slide

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BP profits fall amid oil price slide

British energy giant BP p.l.c . reported a steep decline in first-quarter profits Tuesday, showing the financial impact of the global slide in oil prices. BP said it earned $2.1 billion in replacement-cost profit during the year’s first three months, down from nearly $3.5 billion in the same period of 2014. Earnings per share were 9 cents, more than doubling the 4 cents consensus estimate from financial analysts compiled by FactSet.100491179-bp-gas-station-sign-getty.530x298

After adjusting for non-operating items and accounting effects, the company’s underlying profit for the first quarter was nearly $2.6 billion. That compared with more than $3.2 billion last year. Including the continuing financial impact of the Gulf of Mexico oil spill, BP’s first-quarter cash flow from operating activities was $1.9 billion. That marked a plunge from $8.2 billion during the same period last year.

“Our results today reflect both the weaker environment and the actions we are taking in response,” BP CEO Bob Dudley said in a statement with the earnings announcement. The company announced a quarterly dividend of 10 cents per share, scheduled for payment on June 19. BP shares were up 2.04% at $43.92 before U.S. financial markets opened Tuesday.

The energy sector has been buffeted by the global drop in oil prices that began last summer. The cost of Brent crude averaged $53.94 during the first quarter, BP said. The slide has idled drilling rigs and prompted layoffs, along with industry consolidation. Royal Dutch Shell earlier this month announced plans for a $70 billion cash and stock acquisition of Britain’s BG Group, a transaction that would create the word’s largest producer of liquefied natural gas.