The Yukos Oil Company has said that 2001 profits fell by twenty nine percent, excluding a one time tax gain, after oil prices slumped at home and abroad and domestic inflation boosted costs at Russia's second largest oil company.
Net income fell to 78.8 billion rubles ($2.6 billion), or 37.08 rubles a share, from 111.3 billion rubles, or 50.96 rubles, in 2000, based on US generally accepted accounting principles, Yukos said in a statement. The one time tax credit was worth 25.9 billion rubles.
A global economic slowdown cut demand for oil last year, driving crude prices down eighteen percent. Yukos, which pumps a sixth of Russia's oil, joined other companies in the country's industry in boosting output to try and capture market share from Middle Eastern rivals. When the government heeded OPEC's call for export cuts, that helped flood the domestic market.
“Domestic prices went as low as five dollars a barrel last year because oil export restrictions created a glut on the domestic market,” said Valery Nesterov, an analyst at the Troika Dialog brokerage in Moscow. “Even Yukos's increase in output didn't help much in the face of those lower prices.”
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