BP Q1 profit beats estimates on trading

BP Plc, Europe's second-biggest oil company, reported profit that beat analyst estimates because of an improved performance at its fuel trading business. The shares rose the most in six months in London trading.

Earnings adjusted for one-off items and inventory changes fell to $4.2 billion in the first quarter from $4.7 billion a year earlier, the company said on Tuesday in a statement. That exceeded the $3.2 billion average estimate of 11 analysts in a Bloomberg News survey. Net income tripled to $16.9 billion after BP sold its half of the TNK-BP unit in Russia.

CEO Bob Dudley is trying to convince investors that BP is poised for growth three years after the Gulf of Mexico oil spill that left the company with a bill of more than $40 billion. The trading gain offsets a drop in oil prices and a production decline following divestments.

BP is "highlighting stronger trading and gas marketing earnings," said Iain Reid, an analyst at Jefferies Group LLC in London.

"Shares are likely to pop today" on "excellent" results, he said. BP produced the equivalent of 2.33 million barrels of oil a day in the quarter. That's 5 per cent lower than a year earlier, though 2 per cent higher than in the fourth quarter. Output in the second quarter will probably be lower, BP said.

Exxon Mobil Corp, the world's biggest company, last week reported an increase in profit on the strength of its chemicals business.

Chevron Corp and Total SA reported a drop in net income.

Royal Dutch Shell Plc, Europe's biggest oil company, may say on May 2 that profit slid to $6.5 billion from $7.28 billion, a Bloomberg survey of 11 analysts shows.