OIL FIRM BP could feel the impact of problems with the Russian economy as a result of its 19.75 per cent stake in Rosneft, bought in March 2013.
The $25bn (£16bn) deal, which saw BP sell its 50 per cent stake in TNK-BP to state-controlled Rosneft for $12.3bn in cash plus stock, was seen as a coup for BP at the time, giving the company a foothold in a major oil producing country.
However, Rosneft has been hit by plummeting oil prices, the collapse of the rouble and sanctions put in place by the EU and US, and the company’s profits plummeted by over 99 per cent in the third quarter of this year.
In addition, the firm was due yesterday to make the first payment towards repaying more than $30bn to a group of lenders including Barclays, Citigroup and Bank of America Merrill Lynch. Rosneft declined to confirm whether this payment, expected to be between $7bn and $10bn, had been made.
Analysts at BMO Capital Markets had stated that they believed the company could make the payments, “but only at the expense of reducing capex even further than its peers, which would inevitably reduce upstream production”.
BP declined to comment yesterday.