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Investing.com - BP (NYSE:BP) stock slumped Tuesday after the energy giant warned that its second-quarter results will be hit by lower refining margins and it also expects to post an impairment of up to $2 billion.
At 06:30 ET (10:30 GMT), BP shares fell 3.9% to 455.98 pence.
BP warned, in a statement released earlier Tuesday, that weak refining margins and a disappointing oil trading performance is likely to weigh on its second-quarter results, due out on 30 July, to the tune of between $500 million to $700 million.
The oil major also noted that it would take an impairment of up to $2 billion in the second quarter relating to the ongoing review of its Gelsenkirchen refinery in Germany.
Upstream production in the second quarter is now expected to be “broadly flat” compared to the previous quarter, BP said, adding that it anticipates an average gas marketing and trading result.
BP also disappointed in the first quarter of the year, with the energy giant posting lower than anticipated underlying profit due to a slide in oil and gas prices.
Underlying replacement cost profit -- a gauge of net income -- dropped to $2.72 billion, down from $4.96 billion in the corresponding three-month period last year. Company-compiled forecasts had been anticipating a mark of $2.87 billion.
BP noted that the results were also dented by an outage at its key Whiting refinery in Indiana and "signficantly weaker" fuels margin, which both offset a "strong" oil trading performance and higher realized refining margins.
