The 2010 Deepwater Horizon oil spill continues to plague BP PLC (LON:BP) with the company expecting to take a US$1.7bn charge in relation to the disaster in the fourth quarter.
Total cash payments for the year are anticipated to be around US$3bn, above the previous estimate of US$2bn.
BP, which reports its full year results on Tuesday, has been winding down its settlement for the disaster that killed people in April 2010 and saw 4.2 barrels of oil spilt into the Gulf of Mexico.
Nicholas Hyett, equity analyst at Hargreaves Lansdown, said while costs relating to Deepwater Horizon are set to be higher than originally expected this year, charges are finally starting to decline.
“That should free up significant cash flow for reinvestment and debt reduction,” Hyett said.
BP should also benefit from a recovery in oil prices. The company has been ramping up production in line with the increase in oil prices, which analysts expect to lift revenues and profits.
On the back of the improved market conditions, BP launched a share buyback scheme in October.
Jon Rigby, analyst at UBS, in a preview note, said that it expects a particular focus on BP's portfolio and production profile.
“Among the broad themes typical to the industry - capital discipline, shareholder returns, and energy transition,” the analyst said.
“Compared to other Majors, BP's 2020+ project portfolio appears gas-weighted (but not LNG) and has limited Brazil or US liquids exposure.”
Rigby added: “We expect BP to keep its dividend unchanged, but to continue anti-dilution stock buybacks.”
In the grocery sector, Ocado PLC (LON:OCDO) reports its full year results with the focus on the group winning further international deals to fend off competition from Amazon.
Earlier this month, the online grocer signed up its second major international customer less than two months after the first, with Canada's Sobey.
Credit Suisse said it expects "at least two" more third-party deals to be announced over the next 12 months.
The Swiss bank noted that the Canadian deal uses the same structure as the contract with France's Casino signed at the end of November, with exclusivity for as long as a pre-determined capacity growth profile is met.
Analysts have stressed that Ocado needs to secure more global deals as it faces tough competition following Amazon’s acquisition of Whole Foods.
So far it seems unaffected with the company reporting an 11.6% increase in revenue to £373mln in the 14 weeks to December 3 as average orders per week grew 11.1% to 280,000.
Significant announcements expected:
Finals: BP PLC (LON:BP), Ocado Group PLC (LON:OCDO), Amino Technologies PLC (LON:AMO), RM Plc(LOON:RM), St Modwen Properties PLC (LON:SMP)
Interims: Hargreaves Lansdown PLC (LON:HL.), Frontier Developments PLC (LON:FDEV), Mattioli Woods plc (LON:MTW)
Trading update: Babcock International PLC (LON:BAB), Carpetright PLC (LON:Q3)
Economic data: US international trade numbers