CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Open account
☰
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Open account
✖

Gazprom profits up 71 per cent

Article By: ,  Financial Analyst
August 10, 2015 4:36 PM

Russian energy giant Gazprom has announced a 71 per cent rise in profits on the back of a weak rouble, which boosted the value of the company’s overseas earnings in the local currency.

Net profit for the first quarter of the year was 382 billion roubles (£3.8 billion), with total sales rising six per cent to 1.65 trillion roubles.

The weak currency counterbalanced a 10 per cent fall in the volume of sales, which was mainly due to sanctions imposed by the West.

They were implemented after Russia annexed Ukraine's Crimea region in March 2014, and they have been escalated during the fighting in eastern Ukraine, where Moscow is backing separatist forces.

These, along with declining oil prices, have hit the country hard, as the economy relies heavily on revenues from oil exports. Its economy shrank by two per cent in the first three months of this year, which represented the first contraction since 2009.

The Central Bank of Russia (CBR) expects the Russian economy to contract by between 3.5 per cent and four per cent in 2015.

New sanctions

The higher profits come as fresh US sanctions were announced late on Friday (August 7th), which pushed Gazprom shares down to as much as 2.4 per cent – to their lowest in more than a week.

The US said it would curb supplies of equipment to Gazprom’s Yuzhno-Kirinskoye, the company's largest offshore field.

The new sanctions, along with a lower oil price that is now back below $50 a barrel, should hit the company's revenue in the next quarters, according to analysts.

The first-quarter result may be “the last positive period for Gazprom in the new price environment” as foreign-currency revenues decline, Pavel Kushnir, a Deutsche Bank AG energy analyst in Moscow, told Bloomberg.

Gazprom charged with abusing dominant position

In addition, the company was charged by the European Commission with abusing its dominant market position in Central and Eastern European gas markets.

Antitrust regulators said it raised barriers to competition in eight EU states, including the Czech Republic, Hungary and Slovakia. 

In five of those countries – Bulgaria, Estonia, Latvia, Lithuania and Poland – EU regulators accused Gazprom of charging unfair prices through calculations that link gas prices to oil prices.

StoneX Financial Ltd (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.

No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

For further details see our full non-independent research disclaimer and quarterly summary.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. CFD and Forex Trading are leveraged products and your capital is at risk. They may not be suitable for everyone. Please ensure you fully understand the risks involved by reading our full risk warning.

City Index is a trading name of StoneX Financial Ltd. Head and Registered Office: 1st Floor, Moor House, 120 London Wall, London, EC2Y 5ET. StoneX Financial Ltd is a company registered in England and Wales, number: 05616586. Authorised and regulated by the Financial Conduct Authority. FCA Register Number: 446717.

City Index is a trademark of StoneX Financial Ltd.

The information on this website is not targeted at the general public of any particular country. It is not intended for distribution to residents in any country where such distribution or use would contravene any local law or regulatory requirement.

© City Index 2024