Venezuela oil sanctions hit Finland's biofuel Neste
By Tarmo Virki
Petroleumworld 04 26 2019
Finnish biofuel producer and oil refiner Neste reported a bigger-than-expected fall in quarterly profits on Friday, as U.S. sanctions against Venezuela hurt crude oil supply to its Nynas joint venture.
First quarter core operating profit fell 6 percent to 378 million euros ($421 million) from 401 million a year earlier, the lower end of analysts' forecasts, which ranged from 376 million to 429 million in a Reuters poll.
Neste booked a 31 million euro loss in the quarter from Nynas - a joint venture with Venezuelan state oil company PDVSA on which Washington imposed tough restrictions in January. Nynas uses Venezuelan crude oil in refineries across Europe.
Venezuelan President Nicolas Maduro has accused U.S. President Donald Trump of waging economic war against Venezuela as oil contributes more than 90 percent of exports from the OPEC nation and the lion's share of government revenues.
Nynas, which had 2017 sales of 15 billion Swedish crowns ($1.58 billion) owns three refineries in Sweden and Germany, and a joint venture with Shell in Eastham, UK.
Neste said second quarter sales volumes of its key Renewable Products' unit are expected to be approximately the same as in the first quarter of 2019, with utilization rates at the unit remaining high, but the raw material prices are expected to increase from the first quarter level.
“Oil Products' reference margin in the second quarter is expected to be higher than in the first quarter, driven by a seasonally improving gasoline market,” Neste said.
Shares in Neste were 1 percent lower at 31.90 euros in early trades.
$1 = 0.8980 euros $1 = 9.5150 Swedish crowns
Reporting by Tarmo Virki; Editing by Kirsten Donovan and Elaine Hardcastle from Reuters.
Reuters.com 04 26 2019