StockMarketWire.com - Oil major BP nearly halved its third-quarter dividend even as it swung to a profit, as the impact of lower oil prices on revenue was offset by cost cutting.

BP cut its quarterly dividend by 48.8% to 5.25 cents per share, though this was in line with the level the dividend had been rebased to earlier in 2020.

Underlying replacement cost profit, its definition of net income, was $86 million.

That was down from $2.2 billion a year earlier, but an improvement on its second-quarter loss of $6.7 billion.

BP said it expected its headcount to reduce by around 10,000 positions, with headcount down by 2,800 for the year so far.

'BP expects to incur people-related costs associated with the reinvent programme, including redundancy payments, of around $1.4 billion over the next 1-2 years, primarily in 2020,' it added.

Looking ahead, BP said it expected US gas supply to continue its decline in 2021, amid a drop production, and forecast refining margin to remain challenging.

'The refining margin outlook remains challenging, given record high inventory levels and a levelling off in demand recovery for gasoline and jet fuel due to COVID-19,' it added.

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