Repsol-YPF, Spain’s largest oil company, said its second-quarter earnings dropped 7.3 percent after refining margins narrowed and output declined because of the Libyan civil war.
Repsol-YPF released a statement noting, “The main factors explaining the decline in earnings from the year-earlier quarter were the output decline in Argentina due to social conflicts, and the suspension of production in Libya,” Mercopress news agency reported.
Repsol-YPF Chief Financial Officer Miguel Martinez told journalists during a conference call that while Libya in the short-term remained “uncertain,” Repsol-YPF facilities in the country are still undamaged. Before the crisis, Repsol-YPF produced 345,000 barrels per day in Libya, or a net production of 40,000 barrels after paying back some of them to Libya as taxes, adding, that the output was “14 percent of our global production… obviously, if we cannot count on Libyan production, (Repsol-YPF) accounts will be affected, but it all depends on how long the conflict lasts.”
Five months ago Repsol-YPF, which has been in Libya for nearly four decades, halved its oil production in the country and evacuated all of its expatriate workers there because of mounting protests against Gaddafi’s 42-year rule.
Other global incidents affecting Repsol-YPF’s bottom line are labor strikes in oilfields it operates in Argentina.
By. Joao Peixe, Deputy Editor OilPrice.com
Joao is a writer for Oilprice.com