Rosneft profit jumps despite pipeline setback, Opec cuts

Russian President Vladimir Putin meets with Russia's oil giant Rosneft chief Igor Sechin in Moscow on February 11, 2020. — SPUTNIK / AFP pic
Russian President Vladimir Putin meets with Russia's oil giant Rosneft chief Igor Sechin in Moscow on February 11, 2020. — SPUTNIK / AFP pic

MOSCOW, Feb 19 — Russian oil giant Rosneft today announced a sharp increase in net profit last year despite a polluted oil incident involving a key pipeline and Opec’s production reduction agreement.

The state-controlled company posted a net profit of 708 billion rubles last year (US$11 billion), up 29 per cent compared to 2018.

Rosneft CEO Igor Sechin, who is a close ally of President Vladimir Putin, said the company’s financial performance was successful last year despite “a series of negative factors and market uncertainties.”

In April, a key pipeline to Europe named Druzhba, or Friendship, was shut down due to contamination with chlorine compounds.

The pipeline takes oil to a number of countries including Poland, Germany and Slovakia.

“The restriction of oil intake to the Transneft main pipeline system did not allow the company to fully realize the potential of its production capacity,” Sechin said in a statement.

“The Opec+ agreement had an additional impact in terms of production volumes and the timing of new projects,” he added.

Opec and its allies in December agreed a deal to curb crude oil production to prop up prices, and Opec kingpin Saudi Arabia and others have called for additional rapid cuts to support the oil price.

The world’s biggest listed oil company suffered a new setback on Tuesday when Washington imposed sanctions against its subsidiary over its role in Venezuela, stepping up international pressure to break leftist President Nicolas Maduro’s grip on power.

Rosneft Trading SA, which has helped sell Venezuelan oil despite unilateral US sanctions, and Rosneft vice president Didier Casimiro were targeted by the US Treasury Department. — AFP

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