PARIS (Reuters) - French oil company Total (TOTF.PA) reported a 20 percent rise in third-quarter net adjusted profit to 3.348 billion euros on Wednesday, beating analysts’ expectations thanks to a sharp increase in refining margins.
The result from western Europe’s No. 3 oil company followed the pattern laid out by those big global rivals that have already reported; It benefited from a temporary widening between the price of crude and the selling price of its fuels, thanks mainly to refinery closures in the United States and Europe, but it struggled to keep production of oil and gas - the long term driver of industry profits - at year ago levels.
Total’s refining and chemicals profits climbed 54 percent but its output of oil and gas fell 2 percent to 2.272 million barrels of oil equivalent.
Total’s 3.348 billion euro result beat forecasts of 3.124 billion euros. Most of the western world oil companies that have reported so far this quarter have beaten expectations. In dollar terms profits were up 6 percent.
European refiners’ margins were given a brief boost in the third quarter as a drop in global crude prices did not immediately translate into lower refined fuel prices.
However, weak oil demand in Europe means the windfall should be short-lived.
Total also said the proceeds from asset sales since the beginning of the year had reached about $5 billion, including the sale of the group’s remaining shares in pharmaceutical company Sanofi (SASY.PA).
It also said it still hopes to restart the Elgin-Franklin operations in the North Sea by the end of this year.
Reporting by Michel Rose; Editing by James Regan and Andrew Callus