BP says it has set aside $32.2bn (£20.8bn) to cover the costs linked to the oil spill in the Gulf of Mexico.The company said the charge meant it recorded a loss of $17bn for the three months between April and June.
BP also confirmed that chief executive Tony Hayward would leave the company in October by mutual agreement.
He will be replaced by fellow executive, Bob Dudley, who is currently in charge of day-to-day clean-up operations in the Gulf.
BP also announced it would sell off $30bn of assets.
Mr Hayward said now that oil had stopped spilling from the Macondo well it was a good time to leave the company.
"With the leak now capped, we have reached a significant milestone. This provides a firm basis to reshape the company," he said.
The $32.2bn cost of the clean up includes the $20bn already set aside in an escrow account for compensation claims.
Stripping out the oil spill costs, BP made a second quarter profit, on a replacement cost basis, of £5bn, compared with $2.9bn for the second quarter of 2009.
For the second quarter running, the company will not pay a dividend. It has also ruled out a shareholder payment for next quarter, saying it will not consider its position on future dividends until February 2011, the time of its fourth quarter results.
£11m pension
On Monday, the BBC revealed that Mr Hayward would be entitled to draw an annual pension of £600,000.
Mr Hayward's pension pot is valued at about £11m and he will keep his rights to shares under a long-term performance scheme which could - depending on BP's stock market recovery - eventually be worth several million pounds.
The company's chairman, Carl-Henric Svanberg, said Mr Hayward would be missed.
"The BP board is deeply saddened to lose a CEO whose success over some three years in driving the performance of the company was so widely and deservedly admired," he said.
The handling of the explosion on the drilling rig off Louisiana on 20 April, which killed 11 workers and triggered the worst oil spill in the US, raised questions about Mr Hayward's leadership.
