BP is set to hand out $7bn (£5.45bn) to shareholders throughout 2024 after it beat profit expectations in the second quarter of the year.

In its Q2 financial report, the oil and gas giant said its profits reached almost $2.8bn (£2.18bn), beating previous expectations.

The firm also announced that it had given the go-ahead to develop a new oil field in the Gulf of Mexico, 250 miles south west of New Orleans. This has angered a number of green groups, after the firm scaled back its green investments in the first quarter of the year.

Chief executive officer at BP, Murray Auchincloss, stated: "Our businesses continue to operate safely and efficiently. We are driving focus across the business and reducing costs, all while building momentum in our drive to 2025. Our recent go-ahead of the Kaskida development in the Gulf of Mexico business, and decision to take full ownership of BP Bunge Bioenergia while scaling back plans for new biofuels projects, demonstrate our commitment to delivering as a simpler, more focused and higher value company. This all supports growing returns for shareholders, as we have announced today."

Equity analyst at Hargreaves Lansdown, Derren Nathan, said: "BP’s second quarter results missed analyst’s best guesses by only a small margin despite challenges at its refineries. But that didn’t prevent it from throwing off huge amounts of cash and committing a further chunk of it to shareholder payouts. It also took a further bite out of its net debt pile which now sits at $22.6bn (£17.6bn). The immediate outlook may be a little soft, with third quarter production set to fall, but BP has its eye firmly on high returning initiatives."

As part of its announcement, BP said that it would launch a $3.5bn (£2.73bn) share buyback scheme in the second half of the year, matching that of the scheme in the first half, meaning that $7bn will be returned to investors in 2024.

In the second quarter, the firm said its cost profit from operations was down by 3.4% to $5.4bn (£4.2bn) year-on-year, while its dividend increased by 10%.

Investment director at AJ Bell, Russ Mould, said: "BP’s strategy of pre-releasing bad news seems to have worked as that lowered expectations in the run-up to its results. The shares bounced back after second quarter profit beat forecasts, helping to make up for weak refining margins. A $3.5 billion share buyback went down well and so did a 10% bump in the dividend, showing that the oil and gas producer is still a cash machine."

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