BP warns of ‘tight’ gas market over holidays

BP on Tuesday warned that the gas market would be “tight” in the next few months as demand rises during the winter, though the company enjoyed a highly profitable third quarter this year.

According to The Associated Press, BP said it expected that gas supply “will remain tight during the period of peak winter demand.” The British energy giant also predicted that oil prices will remain steady even as inventories are depleted and consumers, balking at rising gas prices, begin using oil instead.

BP reported its underlying replacement cost profits for the third quarter rose to $3.3 billion, which the AP noted was a steep rise from the $86 million that it reported in third quarter of 2020.

The company’s CEO, Bernard Looney, said, “This has been another good quarter for BP — our businesses are generating strong underlying earnings and cash flow while maintaining their focus on safe and reliable operations.”

In light of its improved financial health, BP said it was rewarding shareholders with a $1.25 billion share-buyback program.

BP’s warning about gas prices comes not long after the U.S. Energy Information Administration released a report warning that U.S households will pay more for energy this winter than they have for “the past several winters.”

“On average across the United States, we expect prices for all fuels to be higher than in recent winters. Rising wholesale commodity prices for natural gas, crude oil, and petroleum products are being passed through to retail prices,” the agency said.

Energy price spikes have been impacting households around the world, particularly in European countries. According to AAA, the national average gas price in the U.S. was $3.41 on Tuesday.