Profit of the oil company BP increased more than twice in 2017

Logo of BP is seen at a petrol station in Kloten

Logo of BP is seen at a petrol station in Kloten

BP (LON:BP) announced Tuesday an increase in underlying profits by 139 percent to $6.2 billion in 2017, marking the biggest year since the Deepwater Horizon accident.

The oil giant posted fourth-quarter underlying replacement cost profit, used as a proxy for net profit, of $2.1 billion, beating analysts' projections of $1.9 billion.

The results reflect the benefits of higher oil prices on BP's business, oil is trading at $70 per barrel in the recent weeks -the highest level in three years.

"This has been a really, really good year and it sets us off very well to enter into 2018", CEO Bob Dudley said.

The Zohr natural gas project in Egypt was counted as one of BP's shining achievements a year ago.

BP's earnings were also given a boost after seven new projects came on line during 2017 - with oil and gas production in the fourth quarter rising by 18% to the equivalent of 2.58 million barrels of oil a day. Gulf of Mexico oil spill payments in 2017 were $5.2 billion, compared with $6.9 billion in 2016.

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BP also took a one-off charge of $900m to adjust to new U.S. tax rules, although it expected a long-term boost from the lowered corporate tax rates.

In 2017, BP managed to cover the costs and pay full dividends at oil prices of 50 United States dollars per barrel. Net debt fell to $37.8 billion at the end of the fourth quarter, down significantly from $39.8 billion in the preceding period. The company is back to breaking even at current oil prices, but will still maintain capital discipline and plans divestments of between $2 billion and $3 billion in 2018, he said.

In the fourth quarter of 2017, the company bought back shares worth 343 million Dollars.

During the fourth quarter, BP re-started its share buyback programme to offset dilution related to its scrip dividend alternative.

There's no guarantee that the cost of the Deepwater Horizon disaster won't rise again, but it will be entirely manageable from cash flow this year and next, Chief Financial Officer Brian Gilvary said by phone.

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