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Colombia’s State Oil Company Reports 17% Profit Decline in Q2

by Krystal

Colombia’s state-controlled oil company Ecopetrol reported a 17.4% decline in net income for the second quarter compared to the same period last year, affected by fluctuating market conditions.

The company’s net income dropped to $839 million (3.376 trillion Colombian pesos) from $1 billion (4.087 trillion pesos) in the second quarter of 2023. Operating income fell by 9.2%, though Ecopetrol’s core earnings margin remained strong at 43%. This performance was driven by increased production, transportation volumes, and stable refinery throughput.

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Ecopetrol noted that despite the boost from improved crude oil spreads and higher Brent prices, external factors still influenced the results. The downstream sector faced a tough environment, similar to other integrated energy companies during the quarter.

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Colombia aims to increase its oil production to 1 million barrels per day by encouraging more activity in less utilized exploration blocks.

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In a related development, Brazil’s state-controlled Petrobras also reported a financial shift in the second quarter, moving from profit to a net loss. Petrobras attributed the loss to unfavorable exchange rates and a one-off tax charge. The net loss was about $470 million, but the company would have posted a net profit of $5.4 billion without the tax charge, which it presented positively.

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Petrobras highlighted its lowest debt level since 2008, at $26.3 billion, and a 12.5% increase in first-half capital expenditure, reaching $6.4 billion. However, investment plans for the full year have been revised downward to between $13.5 billion and $14.5 billion, down from an earlier projection of $18.5 billion.

Additionally, Petrobras and Ecopetrol recently confirmed a natural gas discovery at the Uchuva-2 well off Colombia’s coast. This deepwater well follows the 2022 discovery at the nearby Uchuva-1 well.

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