Hungarian oil and gas group MOL is to report 18% year-on-year profit decline at operating level and a 44% profit plunge in its net profit for the second quarter of 2007, the consensus of analysts in a Portfolio.hu poll has showed on Tuesday. The profit fall is mainly attributable to MOL's Exploration and Production segment (upstream), more precisely the diminishing production.
With regard to the table below we highlight the substantial stdv at net profit estimates.
The biggest fall in profit is to be suffered by the upstream division, despite the fact that crude prices have been largely unchanged during the second quarter, compared to the basis period.
The main culprit for the 37% yr/yr plummet at operating level was lower production figures, which could be observed not only in Hungary but also on Russian fields.
The widening of refining margins, which was mainly attributable to the rise of gasoline crack spreads, did good to the downstream (refining and marketing) segment. Meanwhile, the diesel crack spread was rather stable.
Processes observed in the third quarter, however, may be reason for concern, since the substantial decrease of gasoline crack spreads pushed refining margins to below USD 1 last week.
The diminishing Brent/Ural differential in Q2, which also continued in Q3, had a negative impact on MOL.
The petrochemical division is gaining an ever bigger role within the MOL group, thanks to the immense profit rise in this segment that stems from the favourable petchem environment, the impacts of capacity boost and the weakening dollar.
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