MOSCOW, Nov. 11 (UPI) -- Pointing to ongoing pressures from the weak oil economy, Russian oil company Rosneft said its profit for the third quarter dropped more than 70 percent.
Russia's largest oil producer, Rosneft reported third quarter profit of around $400 million was off 77 percent from the previous year. CEO Igor Sechin blamed the sustained low price for oil for the poor performance.
"In the third quarter, the environment on the commodity markets remained difficult," he said in a statement.
Crude oil prices recovered from below $30 per barrel this year, but remain nearly 50 percent below levels from two years ago.
The company said some of the financial strains were offset by gains from higher crude oil production and spending during the third quarter increased 8.4 percent from the previous term to $2.6 billion as drilling expanded.
Rosneft reported total daily hydrocarbon production increased 1 percent from the second quarter and 1.3 percent year-on-year to 4.1 million barrels per day, despite some production issues at some of its assets.
Total hydrocarbon production was up 0.2 percent from the first quarter and 0.7 percent year-on-year
"I would like to highlight positive results of Rosneft's management cost control and generation of positive free cash flow over the last years in conditions of high market volatility," Sechin added.
The Organization of Petroleum Exporting Countries is looking to non-member states like Russia to help formalize a proposal to put a cap on production levels. A surplus of oil on the market has kept energy prices lower and OPEC said a ceiling would bring the situation back into balance.
Sechin, a close ally of Russian President Vladimir Putin, said there are no market forces standing in the way of an increase in oil production long term. At an energy forum in Vienna last month, he said that, from his perspective, crude oil prices should move steadily beyond $55 per barrel, but not move high enough to increase the appetite for large-scale investments.
The price for Brent crude oil, the international benchmark, was trading near $45 per barrel early Friday.