Russia’s No. 1 oil producer, Rosneft, said its second-quarter net income rose 10.8 per cent year-on-year to $2.83 billion, below analysts expectations, as rising tax bills offset soaring oil prices.
Rosneft’s Moscow-traded shares declined further on the news, and had shed 2.7 per cent by 1315 GMT, on a day when shares were already weak on the back of the US debt woes.
Analysts polled by Reuters expected net income would have risen to $3.06 billion. In May the government cancelled preferential export duty rates for Rosneft’s Vankor oilfield, the main source of growth in Russian oil production as older fields decline.
A Rosneft official told Reuters that the cancellation of tax breaks cost the company $400 million during the quarter, while the effect of rouble appreciation was $200 million.
Rosneft also said the company produced a record daily volume of crude, 2.4 billion barrels per day, in July after an increase in capacity at Vankor. It had also closed the deal to buy a 50 per cent stake in Ruhl Oel GmbH, which owns stakes in four German refineries. Revenues climbed 50.8 per cent to $23.27 billion in April-June, above analysts’ average forecast of $22.41 billion.
From/ Gulf Today