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Rosneft reports strong Q2 earnings as oil prices improve
08 August 2018 , 12:07Neftegaz.RU469
Moscow, August 8 - Neftegaz.RU. Russia’s biggest oil company Rosneft reported record-high free cash flow and a near three-fold increase in net profit for the Q2 on the back of higher oil prices combined with a weaker Russian ruble, which reduces oil producers’ expenses.
Rosneft’s net profit came in at $3.6 billion in the Q2, up from $1.5 billion in the Q1, and the free cash flow figure was the same - $3.6 billion - versus $2.5 billion 3 months earlier.
The company boasted improvements in efficiency over the Q2 of the year, along with the ruble’s depreciation and the rise in crude oil prices, as factors that contributed to its strong performance, which also pushed up BP’s bottom line for the quarter as well.
Cost control was also among the contributing factors for Rosneft’s performance, with the company noting in its report that upstream operating expenses in the 3-month period fell to $3.1 per barrel of oil equivalent, from $3.3 in the Q1. Net debt was also down, by 12 % in dollar terms, and now Rosneft plans to focus more efforts on slimming it down further.
At the same time, Rosneft’s crude oil production was almost unchanged in the Q2: it registered an uptick of less than a percent from the Q1 and from a year earlier, at 4.6 million bpd. The company said it had the technological capacity to boost crude production by 200,000 in the current quarter, and it had already added some 120,000 bpd of this increase between June and July, following the OPEC+ agreement to suspend production cuts.
Gas production, on the other hand, declined in the Q2 due to seasonal factors and maintenance, Rosneft said, adding, however, that its share of gas production from Eni’s huge Zohr field in Egypt had risen as a result of the overall boost of production there.
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