BP, Europe's largest oil company, has followed Shell in admitting that it has wrongly estimated its level of "proved" crude and gas reserves.

Unlike its smaller rival, however, BP has said that it has understated its stocks.

The announcement comes a day after Shell's directors were attacked at the company's annual meeting by investors incensed at the downgrading of more than 20 per cent of the company's proven reserves.

BP has said that, following guidelines laid down by the Securities and Exchange Commission, its North Sea reserves were 151 million barrels of oil greater last year than published in the company's 2003 annual report, which was published in March. Stocks at US fields had been understated by 332 million barrels of oil.

However, the revision also resulted in the cutting of 325 million barrels of oil from the estimate of reserves in Africa.

The overall effect was to increase by 23 million barrels of oil BP's proved reserves, taking them to 18.34 million barrels of oil at the end of last year.

The revision was caused by differences in oil prices. SEC guidelines are based around market prices which, at the end of last year, stood at $30.10 for a barrel of Brent crude. In its UK accounting, BP uses so-called "long-term planning prices", a more cautious estimate, giving a figure of $16 per barrel of oil.

The SEC figure, by increasing the level of reserves economically viable to exploit, has the effect of increasing proved stocks, although in some cases, where BP operates through production sharing agreements "a higher oil price results in lower volume entitlement".

BP said it would stick by its UK accounting techniques.

"The company believes that its long-term planning price assumptions provide the most appropriate basis for estimating oil and gas reserves," this morning's statement said.

The statement was welcomed in the City, where Credit Suisse First Boston said the filing "should nail the myth that there is a significantly larger reserve risk for BP than that for Royal Dutch/Shell".

The broker added: "This filing underscores the much more credible proposition that Shell has significantly underperformed the upstream performance of its peers over many years and that its reserve problems are specific and not generic."

BP shares stood 1.75p higher at 492.25p in afternoon trade.

• Norsk Hydro, the Norwegian energy company, has reduced its proven oil and gas reserves by 6.6 per cent. The reduction included a cut of about one third in reserves at its Ormen Lange gas field. The company said its proven reserves were now 2.29 billion barrels of oil equivalent.

  "The difference relates to proved undeveloped reserves; there is no change in proved developed reserves," Norsk Hydro said in a statement.

  Evind Reiten, the chief executive of Norsk Hydro said the downgrade did not change the company's expectations of the reserves that would eventually be produced from the Ormen Lange field, which is Norway's largest offshore development and due on stream in 2007.

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