MOSCOW, Nov 12 — Russia’s Rosneft the world’s second-biggest oil company by output after Saudi Aramco, warned today of a potential “super cycle” in global energy markets, raising the prospect of even higher prices as demand outstrips supply.
Surging oil prices, boosted by rebounding economies worldwide, lifted Rosneft’s net profit to 314 billion roubles (RM18.3 billion) in the third quarter, versus a loss of 64 billion roubles a year ago, the company said.
“We observe a rapid growth in demand for traditional energy resources,” Rosneft Chief Executive Igor Sechin said in a statement. “As structural discrepancies between supply and demand on global energy markets are further revealed, we may witness a new super cycle on the oil and gas markets.”
The Organisation of the Petroleum Exporting Countries and allies including Russia, together known as Opec+, have been increasing output to meet growing demand from late last year, and Rosneft’s oil production rose to 3.98 million barrels per day (bpd), up by 9 per cent, in the third quarter.
Yet at a meeting last week, Opec+ stuck to a plan to raise oil output by 400,000 bpd on a monthly basis, snubbing calls from the United States for a higher increase to keep oil prices in check.
The price of Russia’s flagship Urals oil blend rose to an average of US$70.5 (RM293) per barrel in the third quarter, up from US$43 per barrel a year ago when the demand was still constrained by the pandemic.
To meet rising demand, Rosneft plans to increase investments in new projects, Sechin said, as it ramps-up its Vostok Oil project in Russia’s north, where it sold a 5 per cent stake to Vitol-led consortium for €3.5 billion (RM16.6 billion) last month.
“The key growth project, Vostok Oil, may result in Rosneft’s output rising throughout this decade, assuming Opec+ restrictions are eased or lifted entirely,” brokerage Aton said in a note, valuing the entire project at US$70 billion.
Rosneft’s earnings before interest, taxes, depreciation, and amortization were at 638 billion roubles in third quarter and revenue stood at 2.3 trillion roubles, up from 366 billion and 1.4 trillion roubles in the same period last year, respectively.
