Colombia's state oil company Ecopetrol, has reported a 46% decrease in net profit for the second quarter (Q2) due to declining global oil prices and slight production decreases.
The company's net profit fell to approximately $450m (1.81trn pesos), down from the previous year's equivalent of $840m, with total sales also decreasing by 9% to around $7.4bn, reported Reuters.
Ecopetrol's CEO, Ricardo Roa, used a a press conference to highlight several operational challenges.
“We have had blockades, attacks and thefts that have prevented us from operating, and we have also seen a significant drop in volumes carried by third parties through our transportation assets,” Roa was quoted as saying.
These disruptions, along with new taxes and inflation, have compounded the impact of the oil price decline on the company's financial performance.
The company's total production saw a marginal year-on-year decline of 0.5%, averaging 755,500 barrels of oil equivalent per day (boepd).
Furthermore, earnings before interest, taxes, depreciation and amortisation (EBITDA) fell by 21% to around $2.78bn.
Despite the downturn, Ecopetrol has maintained substantial investments, with around $2.58bn allocated to exploration and production projects within Colombia and in international ventures in Brazil and the US.
As of the end of June, the company had completed drilling six out of the ten exploratory wells planned for the year.
The oil sector globally has been navigating through price volatility, partly due to OPEC+ increasing production, which contributed to an 11% decrease in Brent crude prices over the quarter.
Brent crude prices averaged $67 per barrel (bbl) in Q2, a drop from $75/bbl in the previous three months and $85/bbl in the same period last year.
In contrast to Ecopetrol's performance, Mexico's Pemex and Brazil's Petrobras managed to post profits despite the challenging market conditions.
Meanwhile, Ecopetrol has announced plans to continue with natural gas drilling in the Colombian Caribbean, aiming to cater to growing domestic demand and capitalise on its reserve potential, despite Shell's recent exit from three offshore blocks.
