Rosneft annual profit drops 73 percent as costs rise

PJSC Rosneft Oil Company, the primary oil producer in Russia, announced on Tuesday that its net income for 2025 plummeted by 73% to 293 billion roubles, or roughly $3.60 billion. The company attributed this sharp decline to a challenging environment characterized by high interest rates, a significant profit tax burden, and several one-off financial impacts. Rosneft Chief Executive Officer Igor Sechin characterized the recent performance as the result of an unprecedented combination of external and internal pressures. > The Russian oil industry was caught up last year in the ideal storm of negative geopolitical factors and tight domestic macroeconomic conditions. The operational landscape for the sector has become increasingly complex following sanctions imposed by the United States last October on both Rosneft and PJSC Lukoil. Although global oil prices have been bolstered by geopolitical instability in the Middle East, Sechin explained that these market gains are being offset by the rising costs of doing business, particularly in logistics and insurance. Market data indicates that Brent futures achieved a record monthly gain of 64% in March, while the U.S. benchmark West Texas Intermediate climbed by approximately 52%. However, the CEO pointed out that the expenses associated with reaching new markets have grown exponentially. Specifically, freight rates for shipping Russian oil from Baltic ports to India reached over $20 per barrel in March, a figure ten times higher than the shipping costs to Europe seen at the start of 2022.