Energy companies left bruised as tumbling oil prices bite into profits
Cost of crude down 25% since mid-June with future investment threatened by price slide
A visitor passes a logo of the British multinational oil and gas company, BP during the 21st World Petroleum Congress in Moscow recently. Photograph: EPA
Oil and gas producers BP and BG Group both reported a fall in third-quarter profits yesterday, in part due to the drop in the oil price. Crude has dropped 25 per cent since mid-June, amid surging supplies of shale oil from the US and a slowdown in global demand, particularly in China, the world’s second-largest petroleum consumer. Some are predicting that it could fall even further. Goldman Sachs forecast on Sunday that oil would average $85 a barrel in the first quarter of 2015, down from an earlier forecast of $100. In late trade yesterday Brent, the international benchmark, was trading up 13 cents at $85.96 a barrel.