BP has seen profits more than double to 12.7 billion US dollars (£9.7bn) for 2018, as the company celebrated a year of “transformative” deals.
Shares in the oil giant rose after the results beat expectations, with underlying replacement cost profits – BP’s preferred income measure – surging from 6.2 billion US dollars (£4.8bn) in 2017.
Its fourth quarter underlying earnings also jumped 67 per cent higher to 3.5 billion US dollars (£2.7bn) as its recent takeover of US shale oil and gas assets from BHP Billiton offset a drop in oil prices at the end of last year.
BP completed the 10.5 billion US dollar (£8.1bn) BHP shale deal at the end of October.
Bob Dudley, group chief executive of BP, said: “We now have a powerful track record of safe and reliable performance, efficient execution and capital discipline.
“And we’re doing this while growing the business – bringing more high-quality projects online, expanding marketing in the downstream and doing transformative deals such as BHP.”
He added: “Our strategy is clearly working and will serve the company and our shareholders well through the energy transition.”
The FTSE 100 stalwart has been riding the wave of a rebound in the cost of crude in recent years, as has rival Royal Dutch Shell, which last week reported its best annual profits haul for four years.
But BP has also been embarking on a number of new projects, which have been boosting production and are helping counter the recent easing off of the oil price rally.
The price of Brent crude has fallen sharply from four-year highs of nearly 87 US dollars a barrel in the autumn to about 63 US dollars due to concerns of a slowdown in demand as global growth eases, combined with rising inventories.
BP bosses recently said they believe oil prices will now remain steady at between 50 and 65 US dollars a barrel.
On a reported basis, BP’s full-year profit rose to 10 billion US dollars (£7.7bn) while fourth-quarter results showed it swinging to a 2.7 billion US dollar (£2.1bn) profit from a 583 million US dollar (£447m) loss a year earlier.
The group made another 3.2 billion US dollars (£2.5 bn) of payments in 2018 for the 2010 Deepwater Horizon tragedy, which killed 11 workers and sparked one of the biggest environmental disasters in corporate history.
BP‘s total bill for the Gulf of Mexico oil spill has reached 67 billion US dollars (£51bn) – but the group recently announced plans to pump 100,000 more barrels of oil a day in the region.
Full-year results also showed it made divestments of 3.5 billion US dollars (£2.7bn) of assets and the group announced plans to complete more than 10 billion US dollars (£7.7bn) over the next two years.
BP said it expected recent major projects to ramp up production in 2019 as its pipeline of new projects around the world starts to bear fruit.
It confirmed fourth-quarter shareholder dividend payments of 10.25 cents (7.85p) a share, up 2.5 per cent on a year earlier.
Royal Dutch Shell, Exxon Mobil and Chevron all reported stronger-than-forecast earnings last week.