Shares in BP (BP.L) fell on Tuesday morning, after the oil major posted its weakest quarterly profit in nearly four years.

BP posted a nearly 30% slump in underlying replacement cost profit to $2.3bn (￡1.8bn) in the third quarter. Underlying replacement cost profit is the metric that BP uses as its version of net income.

The energy company had reported underlying replacement cost profit of $2.8bn in the second quarter and $3.3bn last year.

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This latest net income figure was the lowest since the fourth quarter of 2020 during the height of the pandemic, when BP posted an underlying replacement cost profit of $115m.

Despite weaker quarterly results, BP announced a share buyback of $1.75bn, as part of its commitment to announce $3.5bn in purchases in the second half of the year. BP also declared a dividend of $0.08 per share, though that is still much lower than its peak payout of $0.105.

Shares in the energy company were trading more than 2% into the red on Tuesday morning and was one of the biggest fallers in the FTSE 100 (^FTSE) index.

BP CEO Murray Auchincloss said in a statement on Tuesday: "We have made significant progress since we laid out our six priorities earlier this year to make bp simpler, more focused and higher value."

"I am absolutely clear that the actions we are taking will grow the value of BP," he added.

BP attributed weaker net income in the third quarter to factors such as weaker realised refining margins and a weak oil trading result.

In a trading update released earlier this month, BP had already warned that it expected oil and gas production to be “broadly flat” and said it expected to report lower realised refining margins.

BP said it net debt had grown to $24.2bn as of the end of the third quarter, up from $22.6bn in the second quarter.

Keith Bowman, equity analyst at Interactive Investor, said: "In all, the uncertain economic backdrop, including growth concerns for China, continue to offer uncertainty over future energy demand and usage.

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"A previous dialling back of investments in climate friendly areas is unlikely to have pleased all shareholders, while windfall taxes introduced in reaction to higher energy prices and the war in Ukraine persist."

However, he said "despite continued risks, a focus on shareholder returns including a forecast dividend yield of around 6%, currently supports a consensus analyst opinion of the shares as a buy".