BP profits dive in wake of $5bn writedowns

BP booked an extra $5bn (£3.2bn) in writedowns yesterday as profits slumped and the bill for the Gulf of Mexico oil spill spiralled higher.

The oil giant, under pressure from falling crude prices since the start of April, posted a 35 per cent slide in second-quarter profits to $3.68bn, well below City hopes. The poor figures sent BP's shares down 4 per cent.

The $5bn in extra charges taken by BP include a $2.7bn hit on the value of its US refineries and a $2.1bn write-down of its US shale gas assets amid tumbling gas prices. BP also counted the cost of falling contributions from its Russian joint venture TNK-BP, down $700m because of the rapid fall in oil prices.

The bill for the Deepwater Horizon disaster in 2010 grew by $847m over the quarter, taking the total to $38bn.