BP results highlight ongoing volatility of oil prices

BP's profits have more than halved during quarter two, resulting in a drop from $6.75bn in 2008 to $3.14bn in 2009. Nick Raynor, investment adviser at The Share Centre comments on today's results.

"Despite the drop in profits, BP's quarter two figures were better than expected, largely due to the aggressive cost cutting measures put in place at the start of the year. As a result BP has already achieved the $2bn in cost cutting it aimed for in 2009, and is expecting to save a further $1bn during the rest of the year.

"The key reason for profits halving is the ongoing volatility of oil prices; oil has recently been traded on or around $60 per barrel which is the price oil companies claim they need to sell each barrel to break even. However, over the past year oil companies have seen highs of £147 per barrel (seen in last July), down to lows of $30 earlier this year.

"We continue to list BP as a buy for investors looking for a balanced return. Its dividend remains unchanged, which will be good news for income seekers as there were rumours of cuts earlier this year.