City File: Modest expectations for BP

THE CITY still has very modest expectations for BP. Although the shares have recovered from the 180p low they reached last August, after the traumatic departure of Bob Horton, they are still well below the 350p level at which they were trading throughout 1991 and 1992.

Yet David Simon, the new chairman, has already reached this year's pounds 1.3bn target for disposals, and net profits could rise to pounds 900m this year and pounds 1.4bn the year after.

Bears still worry about a rights issue, despite denials, and point to BP's meagre presence in the fast-growing Pacific Rim. BP has always relied on big oil finds, and prospects in Colombia, Vietnam, the Gulf of Mexico, and west of the Shetlands are good enough. Hold.