BP Refining Margins Fall to 10-Year Low

BP said refining oil and selling fuel were less profitable in the first quarter than at any time in the last decade as inventories swelled and competition increased at filling stations in the U.S. and Europe.

The difference between the price the British company pays for crude oil and what it gets from refined fuels dropped by 30% from the fourth quarter. Margins from selling fuel through about 26,800 gas stations narrowed 45%. Oil and gas production also fell short of some analysts’ forecasts.

Pressure from rivals kept retail margins “unsustainably small,” spokesman Shaun Harley said, overshadowing a 23% gain in crude prices in the first quarter. A drop in air travel after the Sept. 11 attacks and a warm winter in the Northern Hemisphere hurt demand for jet fuel and heating oil.