Goldman Sachs was disappointed both by the impact of hurricanes and "significantly weaker" than expected performance in marketing. It is cutting third-quarter earnings by $1.1bn to reflect the trading update and 2005 earnings a share estimates by 7% to $1.12.
Goldman Sachs argues that these disappointments should be put in context of an oil environment "better than it has ever been" and point out that earnings per share will have risen 50% year on year after the downgrades. Earnings will benefit from a sharp rise in global crude prices during the third quarter - compared with the previous one - although BP admitted its own realisations lagged behind the $10 per barrel rise in Brent blend.
The company said its refining business would record another strong performance with margins up by $2 a barrel. Prices rose partly on the back of refinery closures caused by the hurricanes but BP also saw reduced output from its Texas City plant, which has been hit by an explosion.
Those wholesale price increases affected the marketing and retail petrol side of the business, driving down margins in the third quarter over the second one. "The overall marketing result [is] expected to be negative," said BP.