FUEL FOR PROJECFUEL FOR PROJECTS
BP raises breakeven oil price to about $60 a barrel to fund new investments
London — BP is falling behind competitors in one crucial measure of its resilience to oil’s slump. The British company now needs benchmark Brent crude to rise to $60 a barrel this year to be able to fund investments and dividends without borrowing, up from a previous estimate of $50 to $55 a barrel. That means BP is moving in the opposite direction to Exxon Mobil and Royal Dutch Shell, which said cash flow already covered spending. "The 2017 breakeven oil-price guidance is disappointing given the trend to reduce this number in recent years," said Rohan Murphy, an analyst at Allianz Global Investors, which owns 0.6% of BP shares. "Investments come with capex burdens but in the current uncertain environment, increasing the portfolio’s 2017 breakeven seems a step too far." BP did balance its books towards the end of 2016, giving the company confidence to make acquisitions. But the hunt for security of future supply forced it to push its target back for 2017 as a whole. The buying spree...
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