GAIL India’s Profit Tumbles On Supply Cut From Former Gazprom Unit

GAIL (India) Ltd, the country’s major fuel distributor, documented a larger-than-predicted 46.3% tumble in quarterly income on Friday, hit by low gasoline income due to supply disruptions from a former device of Russian energy giant Gazprom.

The company’ standalone gain tumbled to 15.37 billion Indian rupees ($186.24 million) in the July-September quarter, from 28.63 billion rupees a calendar year earlier.

Analysts on regular experienced predicted GAIL’s gain to drop to 20.80 billion rupees, according to Refinitiv IBES data.

Still, GAIL’s revenue from functions rose 78.9% to 384.91 billion rupees as selling price hikes to fertiliser and industrial consumers helped offset very low product sales volumes.

“Owing to ongoing geopolitics, there has been disruption in LNG cargo supplies by a single of the firm’s extensive-time period LNG provider,” GAIL mentioned in a assertion.

Reuters had claimed GAIL experienced to curb LNG materials as very long-phrase lover GMTS, a previous device of Russia’s state-owned Gazprom, failed to provide cargoes because May possibly. One particular-fifth of GAIL’s full quantity of LNG from overseas was secured by Gazprom.

GAIL agreed a 20-calendar year deal with Gazprom Advertising and Singapore (GMTS) in 2012 for yearly buys of an normal 2.5 million tonnes of LNG.

At the time, GMTS was a device of Gazprom Germania, now called Sefe, but the Russian guardian gave up ownership of Sefe just after Western sanctions in excess of Russia’s invasion of Ukraine.

So far Sefe has not supplied 17 cargoes, equal to about 8.5-9 million cubic metres a day, explained R.K. Jain, head of finance at GAIL.

Aside from chopping buyer provides, GAIL has diminished functions at its petrochemical plant.

Jain stated GAIL purchased 1-1.5 cargoes of LNG from location markets last quarter and could invest in related quantities this quarter to meet area need.

GAIL signed a deal with Abu Dhabi Countrywide Oil Co, or ADNOC, before this week to check out brief- and extensive-phrase LNG materials.

The firm’s shares closed down 2.2% on Friday. ($1 = 82.5300 Indian rupees)