BP says fourth-quarter earnings increased five-fold as it benefited from higher oil prices, increased production and lower costs.

BP said Tuesday its underlying replacement cost profit jumped to $2.1 billion from $400 million in the same quarter a year earlier. The figure, which excludes one-time items and fluctuations in the value of inventories, is the industry's preferred gauge of earnings.

Net income fell to $27 million from $497 million, largely due to another $1.7 billion charge for the 2010 Deepwater Horizon oil spill and a $900 million charge related to changes in the U.S. tax code.

Fourth-quarter oil and gas production rose 18 percent from a year earlier to 2.58 million barrels of oil equivalent a day.

For the full year, production costs fell 16 percent to $7.11 per barrel.