Oil giant BP downgraded its production targets yesterday as some of its key installations in the United States continued to be plagued with problems.
BP chief executive Lord Browne of Madingley said the troubled firm will pump 3.95 million barrels of oil a day this year compared with the 4.1 million to 4.2 million barrels originally expected.
The downgrade followed the closure of operations at the Prudhoe Bay oil field in Alaska as well as ongoing difficulties at its Thunder Horse platform in the Gulf of Mexico and at the Texas City refinery.
London-based BP also posted a fall in third quarter profits from $6.46 billion (#3.45 billion) to $6.23 billion (#3.33 billion).
The fall in profits came as output fell to 3.816 million barrels of oil a day between July and September.
That was 8,000 barrels a day less than the same period a year ago when production was devastated by hurricanes which battered its rigs in the Gulf of Mexico.
It was also 202,000 barrels below the level reached in the second quarter of this year and underlined the problems facing BP and Lord Browne.
As well as its US production troubles, BP was faced with higher taxes in Britain’s North Sea and lower refining margins.
Shares in BP have fallen more than 15 per cent since April as investors raised questions over safety.
However, the stock lifted one per cent yesterday as BP said its replacement cost profits for the third quarter were up 58 per cent to $6.98 billion (#3.73 billion) as it was boosted by asset sales.
Analyst Tanya Clarke, of Kepler Teather & Greenwood Merrion, said: "The shares have come under huge pressure over the past few months on the back of weaker oil prices and concerns over its US operations after the temporary closure of the Prudhoe Bay oil field.
"We believe that the market has overreacted and that the shares are looking attractive. BP still offers some of the best growth among the integrated oil companies."
Prudhoe Bay, the largest oil field in the US, was partially closed in August after corrosion was found in pipelines. It followed a massive oil spill in which 270,000 gallons of crude leaked into the Alaskan bay.
BP has also been forced to put back the reopening of the Thunder Horse from 2007 to the middle of 2008 after it was damaged by Hurricane Dennis last year.
The platform is the largest in the Gulf and is expected to produce about 240,000 barrels of oil and 200 million cubic feet of natural gas per day.
And the company is embroiled in an investigation into a fire at its Texas City refinery which killed 15 workers last year.
BP has already settled several lawsuits relating to the Texas City blast and said it has put aside another $400 million (#214 million) to resolve legal disputes, bringing the total bill - including repairs and lost profits - to around $2 billion (#1.07 billion).
A further investigation is looking into allegations of manipulation of crude oil and petrol markets and propane prices.
Despite the problems at BP, the third quarter profits figure was only marginally below the third quarter last year because the cost of crude remained high at $69.60 a barrel - one cent higher than in the second quarter and around $8 higher than a year ago.
Oil prices peaked at more than $78 a barrel in July as fighting between Israel and Hezbollah militants in Lebanon sparked fears of unrest throughout the Middle East.
A calming of tensions and a mild hurricane season in the US eased pressure on oil supplies and crude was trading at a little over $57 a barrel in London yesterday.