Oil prices in 2009 were lower than the previous year
Oil giant BP has reported a 45% drop in annual profit due to lower oil and gas prices and depressed refining margins.
Its replacement cost profit for 2009 was $13.96bn (£8.75bn), compared with $25.59bn in 2008.
The company said that its oil and gas production increased more than 4% in 2009 and its reserves had grown for the 17th year in a row.
Profits during the final three months of 2009 were $3.45bn, up 33% from the $2.59bn reported a year ago.
However, the fourth quarter results fell short of analysts' expectations, and BP shares fell 4%.
BP said third-quarterly output had risen by 3% compared with the same period in 2008, to 4.05 million barrels of oil equivalent per day.
The company said this was due to new field start-ups in the Gulf of Mexico and the absence of a significant hurricane season. It expects production in 2010 to be slightly lower.
BP group chief executive Tony Hayward said 2009 had been a "very good" year.
REPLACEMENT COST PROFIT
Replacement cost profit is the reporting measure typically used by oil companies and reflects the current cost of supplies
The measure strips out gains or losses related to any changes in the value of the firm's stock of fuel products
"I am pleased at the track record we are building of delivering on our promises to shareholders," he said.
Richard Hunter, head of UK equities at Hargreaves Lansdown Stockbrokers, said BP was performing well in challenging circumstances.
"Despite high expectations, tough comparatives and a difficult market, BP continues to deliver," he said
"There is little question that refining margins remain under pressure, but the company is in good shape."
Oil prices dropped in 2009 after hitting a peak of $147 a barrel in 2008.