bp plc on tuesday reported improved earnings for the fourth quarter of 2021 reflecting higher oil and gas production and prices heres what the british energy company had to say underlying replacement cost profit for the quarter was 41 billion compared with 33 billion for the previous quarter this result was driven by higher oil and gas realizations higher upstream production volumes and stronger refining commercial optimization partly offset by a significantly lower oil trading result and an average contribution from gas marketing and trading and the impact of higher energy costs after excluding adjusting items the underlying replacement cost profit before interest and tax for the fourth quarter and full year was 2211 million and 7528 million respectively compared with 154 million and 689 million for the same periods in 2020 the underlying replacement cost profit for the fourth quarter compared with the same period in 2020 reflects higher realizations higher production and a higher gas marketing and trading result offset by a higher depreciation depletion and amortization charge for the full year compared with the same period in 2020 the underlying replacement cost profit mainly reflects higher realizations higher production and an exceptional gas marketing and trading result offset by a higher depreciation depletion and amortization charge reported production for the quarter and full year were 974mboed and 912mboed respectively higher than the same periods in 2020 mainly due to major project startups partially offset by base decline and the partial divestment in oman renewables pipeline at the end of the quarter was 231gw bp net the renewables pipeline decreased by 02gw during the quarter as a result of new projects more than offset by promotions to fid for the full year the pipeline grew by 122gw bp net due to growth in lightsource bp lsbp and the acquisition of a 9gw development pipeline from 7x energy after excluding adjusting items the underlying replacement cost profit before interest and tax for the fourth quarter and full year was 4024 million and 10292 million respectively compared with a profit of 563 million and a loss of 5888 million for the same periods in 2020 the underlying replacement cost profit for the fourth quarter compared with the same period in 2020 primarily reflects higher liquids and gas realizations for the full year compared with the same period in 2020 the underlying replacement cost profit mainly reflects higher liquids and gas realizations and significantly lower exploration writeoffs partially offset by lower volumes reported production for the quarter was 1358mboed which is flat with the fourth quarter of 2020 underlying production for the quarter was 40 higher reflecting lower weather impacts from hurricanes in the gulf of mexico and the rampup and startup of major projects reported production for the full year was 1307mboed 142 lower than the same period in 2020 after excluding adjusting items the underlying replacement cost profit before interest and tax for the fourth quarter and full year was 611 million and 3252 million respectively compared with 126 million and 3088 million for the same periods in 2020 the customers  products results for the fourth quarter and full year reflect a stronger performance compared to the same periods in 2020 despite the absence of earnings from our divested petrochemicals business and ongoing covid impacts utilization for the quarter and full year was around 8 and 5 percentage points higher than the same periods in 2020 mainly due to lower covid related demand impacts bpoperated refining availability for the fourth quarter and full year was 954 and 948 respectively lower compared with 961 and 960 for the same periods in 2020 due to a higher level of maintenance activity after excluding adjusting items the underlying rc profit before interest and tax for the fourth quarter and full year was 745 million and 2720 million respectively compared with a profit of 311 million and 56 million for the same periods in 2020 compared with the same periods in 2020 the higher result for the fourth quarter primarily reflects higher oil prices partially offset by adverse foreign exchange effects the higher result for the full year primarily reflects higher oil prices and favourable foreign exchange effects looking ahead we expect firstquarter 2022 reported upstream production to be lower than fourthquarter 2021 reflecting base decline and higher maintenance within this we expect production from both oil production  operations and gas  low carbon to be lower in our customer businesses we expect product demand to remain impacted by ongoing uncertainty around covid19 restrictions and continued additive supply shortages in castrol in products we expect energy costs to remain under pressure for full year 2022 we expect both reported and underlying upstream production to be broadly flat compared with 2021 within this we expect production from oil production  operations to be slightly higher and production from gas  low carbon to be slightly lower we expect the startup of mad dog phase 2 in the second half of the year and first gas from the tangguh expansion project in 2023 we expect oil supply and demand to move back into balance through 2022 however with lower levels of spare capacity price volatility is likely opec decision making on production levels continues to be a key factor in oil prices and market rebalancing in gas markets with ongoing geopolitical uncertainty and low storage levels we see the potential for continued price volatility in the first quarter of 2022 we expect industry refining margins to remain broadly flat compared to the fourth quarter of 2021