Ecopetrol SA will likely report a decline
in net profit for the second quarter from a year earlier as oil prices fell from
2008 records, analysts said.
A Dow Jones Newswires survey of four local analysts produced a median estimate
of 1.22 trillion Colombian pesos (
“The oil price is the main factor,” said
local brokerage Corredores Asociados. “The net profit in 2009 will be back to
2007 levels,” she added.
The state-controlled oil company posted a record net profit of
The benchmark price of West Texas Intermediate crude oil fell to
A decline in
offset by an increase in production. The company produces 482,000 barrels of oil
equivalent a day, up from an average of 447,000 barrels of oil equivalent a day
“The company has room to improve its efficiency and reduce its costs,” Castro
said. “There may be a surprise regarding costs coming from the earnings report,”
company doesn’t comment on earnings before their offical release.
The company last year started a major investment program to raise output to
one million barrels of oil equivalent a day by 2015.
So far this year,
firms. It bought 50% of Peru’s Petrotech Peruana SA for
stake in the Cartagena refinery from Swiss commodity company Glencore
International AG for
Etablissements Maurel et Prom (5107.FR) for
bought a stake in an oil pipeline from
Those acquisitions, together with the investment in its own operations and in
seeking new oil reserves, should help
within a couple of years.
However, the numbers for the second and third quarters will likely be dire, as
oil prices hit records during that period in 2008, said Andres Otalora, a market
analyst with local brokerage Profesionales de Bolsa SA.
He recommends buying the shares but not for a couple of years. In the short
term, the price will keep following oil prices, he added.
index ended up 2.2%.
Another factor that may hurt
quarter, the Colombian peso appreciated 19%, reducing the value of
assets abroad in peso terms, said
brokerage Bolsa y Renta.
The company may have to include the new valuation of its assets on the balance
sheet as a hefty accounting loss, he added.