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BP has shrugged off the ravages of Hurricane Katrina to report record profits.
Britain's biggest company admitted Katrina and other hurricanes in the Gulf of Mexico shaved £1.9billion off the figure.
But full-year profits still rose by 25 per cent to £11.04billion, thanks to surging oil and gas prices. Yet shares fell 18p to 647.5 as the City had expected even better.
BP chief executive Lord Browne blamed accounting changes, adding: “It's not economic factors. The money will come back over one to two years.”
He denied claims – as did ROYAL DUTCH SHELL last week – that BP was making excess” profits. Lord Browne added: “We are not profiteering. We make most of our money producing oil and gas – not the refining and selling of petrol. The profits are magnified by high oil and gas prices, but that was done through positioning the company and investing over many years. The money doesn't sit in the company. Most goes back to shareholders, which are basically UK pension funds.”
Lord Browne said the row with Iran, the world's fourth biggest oil producer, over its nuclear programme would not have a long-term impact on prices. He said Iran was unlikely to withhold oil and added: “People rarely do something which damages themselves just to damage somebody else.”
SUN CITY COMMENT: Unlike Shell, BP replaced nearly all the oil it pumped last year with new reserves. That is why, if you must own shares in one of the two, BP is the one to have.

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