Russian oil giant’s profits soar amid sanctions

Net profits at Russia’s largest oil producer, Rosneft, jumped by 45.5% in the first quarter of this year compared to the previous three months, hitting 323 billion rubles ($4 billion) due to a rise in output, the company announced this week.

Analysts polled by the Interfax had expected the figure to be far smaller, at $2.9 billion.

Oil and gas production in the first quarter increased by 0.8% from October to December, exceeding four million barrels per day, Rosneft reported. Production at the Sakhalin-1 project in Russia’s Far East jumped by 180%, quarter on quarter.

The company’s CEO Igor Sechin, however, warned that operations would be further impacted by Moscow’s decision to reduce its oil output by 500,000 barrels per day, or about 5%, in order to bolster global oil markets.

“While the cut did not have much influence on the Q1 2023 results, it will have a strong impact on the results of the following quarter,” he warned.

Rosneft attributes the rise in profits to increasing energy sales to India and other ‘friendly’ states.

India, the world’s third-largest crude importer, ramped up purchases of Russian oil shortly after the start of Moscow’s military operation in Ukraine and the ensuing Western sanctions. New Delhi has repeatedly stressed that energy security is its top priority. It has chosen not to succumb to Western pressure and has continued to stock up on Russian supplies, even after the G7 price cap on Russian oil came into force late last year.

Sechin said recently that Moscow and New Delhi had agreed to “substantially increase” the supply of crude oil to India and diversify its grades.

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