BP reported today that profits for its Castrol lubricants business fell 32% in 2022 and dropped 67% in the fourth quarter – due, the company said, to higher input costs, ongoing COVID restrictions (notably in China) and adverse foreign exchange impacts.
London-headquartered BP said its Castrol unit had an underlying cost replacement profit before interest and taxes of $700 million for full-year 2022, declining from $1 billion for the 12 months of 2021.
In the fourth quarter, the lubricants unit’s profit was $70 million, down from $207 million in the same quarter in 2021.
Capital expenditure for the Castrol unit increased 36% to $235 million in 2022, compared to $173 million. For the fourth quarter, the capital expenditure jumped 85% to $98 million, up from $53 million.
Overall, BP’s profits also took a beating in 2022, with a $2.5 billion loss, compared to a $7.6 billion profit. The company posted stronger results in the fourth quarter, turning a $10.8 billion profit, for a 364% improvement from $2.3 billion. However, that and a $9.3 billion profit in the second quarter were not enough to offset a $20.4 billion loss in the first quarter and a $2.2 billion loss in the third quarter.
In its stock exchange announcement’s first quarter 2023 guidance, BP said it expects volumes for its overall business to remain low in the near term.