BP’s bumper profits today may not delight drivers and will make the company an easy target for politicians and green campaigners.

But for the company’s shareholders, which include most of Britain’s pension fundholders, they are a welcome sign that chief executive Tony Hayward is making steady progress towards implementing his turnaround plan.

While the results were undoubtedly flattered by near-record crude prices - which started the third quarter around $140 and ended it at just under $100 per barrel, they also indicate a marked improvement in the group’s operational performance.

The return to service of BP’s biggest production oil platform, Thunderhorse in the Gulf of Mexico, led to an underlying production rise of 5 per cent to 3.66m barrels per day.

There was also a 70 per cent increase in the result from the group’s downstream refining and marketing unit following the recovery of the group’s Texas City and Whiting refineries in the US.

With a 148 per cent rise in profits to $10bn, BP beat most analysts' expectations and hinted that it was preparing to make acquisitions.

Nevertheless, despite the big headline profits, BP continues to face big challenges.

Mr Hayward reached an uneasy truce with his Russian partners in TNK-BP during the quarter, but how long this may hold is anyone’s guess.

Above all, the recent steep fall in crude prices - which were not reflected in the latest batch of figures - will put a new squeeze on BP by eroding the profitability of high-cost projects, including its deepwater operations in the Gulf of Mexico, and its newly acquired stake in the Canadian oil sands.

The real litmus test of his achievements so far will come in January, when BP unveils its fourth quarter results which will reflect a far more challenging environment for the oil industry.

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