Russian Oil Giant Boosts Profits Despite Sanctions

By Staff, Agencies

Russian oil giant Rosneft has increased its net profit by 13% in the first half of 2022 despite Western sanctions. The company’s net income rose to 432 million rubles [$7.22 billion], while debt decreased by 12%, compared to the beginning of the year, strengthening the company’s “financial resilience,” the oil major said in a statement this week.

Rosneft like other Russian companies has been affected by Western sanctions. According to the oil major, tight controls helped it deal with a sharp rise in the cost of logistics, rail transport and electricity, which account for 30% of total expenses.

According to Rosneft’s CEO Igor Sechin, during the first half of the year the company “was under unprecedented pressure of adverse external factors and unlawful sanctions. However, thanks to high operational efficiency and appropriate management decisions, we were able to ensure business continuity and demonstrate stable results.”

Rosneft processed 45.8 million tons of oil through June with sales increasing by 5.7% year on year. One reason is growing demand from some of the world’s biggest economies which has helped Russia to export almost as much crude as it did before the conflict in Ukraine.

At the same time, oil sales on the domestic market have also more than doubled compared to the same period in 2021.

The oil major also noted that it had paid out dividends worth more than 441 billion rubles [$7.4 billion] for 2021 to its shareholders, including BP, despite the company’s announced plans in February to abandon its 19.75% stake in Rosneft.