Lukoil 2Q Earnings Rose on Stronger Prices, Volumes -- Commodity Comment
August 27 2021 - 5:45AM
Dow Jones News
By Jaime Llinares Taboada
Lukoil PJSC on Friday reported improved earnings for the second
quarter, reflecting stronger prices for crude oil and refined
products, and higher volumes for oil production, oil trading,
refinery throughput and retail sales. Here's what the Russian
company had to say:
On 2Q revenue and earnings:
"In the second quarter of 2021, our sales amounted to RUB2,201.9
bln, up 17.3% quarter-on-quarter."
"The growth was mainly attributable to higher prices for crude
oil and refined products, higher oil production and trading
volumes, as well as higher refinery throughput volumes and retail
sales volumes of refined products in Russia and
internationally."
"These factors were partially offset by lower refined products
trading volumes."
"As compared to the six months of 2020, our sales increased by
53.8% mainly due to higher hydrocarbon prices and ruble
devaluation."
"In the second quarter of 2021, Ebitda increased by 8.1%
quarter-on-quarter to RUB 339.8 bln."
"Besides higher oil prices, Ebitda of the Exploration and
production segment in Russia was positively affected by higher oil
production volumes due to the OPEC+ agreement. The growth was
constrained by lower positive time lag effect of export duty and
MET.
"Outside Russia, Ebitda dynamics was mainly attributable to
lower costs at the West Qurna-2 project, as well as lower gas
production in Uzbekistan."
"The main growth factors for the Ebitda of the Refining,
Marketing and Distribution segment in Russia were higher refining
margins and throughput volumes, as well as better results in
petrochemicals, lubricants and aircraft fueling. The growth was
constrained by lower positive inventory effect at the refineries
and lower retail margins."
"Outside Russia Ebitda was lower mainly due to the specifics of
accounting for hedging operations in international trading, as well
as lower positive inventory effect at the refineries."
On Covid-19 impacts:
"The consequences of the pandemic for the Company's operating
results include: crude oil production cut at the Company's fields
in Russia and certain international projects due to the OPEC+
agreement; gas production cut in Uzbekistan in 2020 due to
temporarily lower demand for Uzbek gas from China; reduction of
refinery throughput volumes due to lower refining margins and lower
demand for some refined products; and lower sales volumes of motor
fuels through filling stations because of lower demand."
"The main impact of the pandemic on the Company's financial
performance is attributed to volatility in prices for crude oil and
refined products as well as lower production volumes."
On OPEC+ quotas:
"On April 12, 2020 a number of oil-producing countries,
including OPEC members and Russia, entered into an agreement that
aims to reduce their collective crude oil output starting from May
1, 2020 with subsequent gradual increase."
"Due to the agreement, in May, 2020, the Company cut its crude
oil production in Russia by approximately 310 thousand barrels per
day as compared to the average daily production in the first
quarter of 2020."
"Later the Company has been gradually increasing crude oil
production in Russia. As a result, in the second quarter of 2021
the Group's crude oil production in Russia was approximately 170
thousand barrels per day higher as compared to the level of May,
2020."
"Crude oil production was also reduced at certain international
projects. In particular, production at the West Qurna-2 project in
Iraq in the second quarter of 2021 was approximately 50 thousand
barrels per day lower than the project capacity."
Write to Jaime Llinares Taboada at jaime.llinares@wsj.com;
@JaimeLlinaresT
(END) Dow Jones Newswires
August 27, 2021 05:44 ET (09:44 GMT)
Copyright (c) 2021 Dow Jones & Company, Inc.
PJSC Lukoil (CE) (USOTC:LUKOY)
Historical Stock Chart
From Jul 2024 to Aug 2024
PJSC Lukoil (CE) (USOTC:LUKOY)
Historical Stock Chart
From Aug 2023 to Aug 2024