UK – Pension funds are the main beneficiaries of surging oil company profits, says BP chief executive Lord Browne.

The comments came as the oil giant raised its dividend and said it would be able to return up to $65bn to shareholders if prices hold up.

“Well we’re not profiteering,” Browne said in an interview with BBC radio. “We make most our money in what most people would regard as a wholesale market – that is the production of oil and gas not in the refining and sales of petrol and so forth.

“I think the real question is - where does the money go? The money doesn’t sit in the company. It is used to invest for the future but the vast bulk of it is sent back to our shareholders which are basically the pension funds of the United Kingdom.”

BP raised its dividend to 9.375 cents per share from 8.925 in the third quarter. And it said that if oil prices are around $41 per barrel between 2006 and 2008 it would be able to distribute around $50bn in dividends and buybacks over the period. And at $60 a barrel they would get around $65bn.

Overall, the company posted a 22% increase in quarterly profit to $3.69bn.