(Bloomberg) -- Repsol (OTC:REPYY) SA said first-quarter profit slumped 28% as oil prices began their unprecedented decline.
Earnings from the Spanish energy producer, like those of its peers, reflect what’s proving to be a historic moment for the industry. Crude’s collapse has forced companies to make drastic cuts in spending and, in some cases, slash shareholder payouts.
Repsol has already canceled plans to unveil a new clean-energy strategy this month and halted its share buybacks, though it has maintained its dividend.
Adjusted net income fell to 447 million euros ($488 million) in the first quarter, while earnings from oil exploration and production plunged to 90 million euros from 323 million euros a year earlier.
Benchmark Brent crude is currently trading below $29 a barrel. It’s down more than 50% since the start of the year as the coronavirus pandemic wipes out fuel demand, meaning oil companies that also refine crude are hit twice over. Repsol estimates an average Brent price of $35 from April to December this year.
Repsol relies heavily on its downstream business in Spain, where the government ordered one of Europe’s most stringent lockdowns in mid-March to slow the spread of the virus.
In its quarterly report, Repsol for the first time split its downstream units into two: industrial production -- including fuel refining and chemical production -- and commercial and renewable-energy operations, which include filling stations and electricity.
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