p>BP is planning to restructure its trading division to counter a drop in profitability and focus on faster-growing emerging markets, according to an internal e-mail seen by Platts Friday. BP's trading profitability has "eroded" due to a tougher operating environment with the trading arm suffering a deterioration in margins due to lower market volatility, according to an email sent to staff by the head of BP's integrated supply & trading division Paul Reed. Over capacity in the refining industry has resulted in tight product and sweet sour spreads, while growing storage of crude and products has limited BP's contango opportunities, according to Reed. The shake up could lead to job losses among BP's trading division which employs some 3,500 staff mostly in its five main trading offices in London, Singapore, Houston, Chicago, and Calgary. Reed also said that upcoming regulation on the markets would, "lead to fundamental changes in the way the industry does business, funds itself and uses exchanges and clearing houses." "Our size and scale has been a source of competitive advantage but with it has come with some impact on our nimbleness and responsiveness," Reed said in the email. He said BP's business needed to adapt to growth in newer market such as China and India as well as emerging areas of oil supply such as West Africa and Brazil. In gas, Reed said BP needed to be more exposed to the continental European markets which continue to open up, and growing LNG activity.
China Chemical Weekly: http://news.chemnet.com/en/detail-1411716.html
