KUALA LUMPUR, AUG 23: Petronas’ profits for the 2nd quarter of 2016 dropped by 85% in the wake of low oil prices as the company recorded a net profit of RM1.62 billion in the quarter compared to RM11.07 billion the year before.
Petronas issued a statement stating company revenues were at RM48.44 billion, a 21% drop compared to the same period in 2015.
Petronas expects to be affected by uncertain oil prices for the remainder of the year.
“Although crude oil prices have recovered slightly, oversupply and a weak market will ensure uncertainty continues,” the statement read.
Malaysia’s economy is the third largest in Southeast Asia, but now it is now faced with falling oil prices and external demand that will lead to reduced revenue and pressure on the ringgit.
Malaysia has also been rocked with a financial scandal following allegations that billions of ringgit were embezzled from a state-owned investment fund founded by Malaysia’s prime minister.
Earlier this month, Malaysia’s economic growth was at 4% for the period of April to June, - the lowest growth rate since being at 1.1% during the global economic crisis in 2009.
Last month, Malaysia announced an interest rate cut for the first time in seven years.
Oil prices also fell on the stock market due to oversupply, dropping more than 20% and closing at US$40 a barrel for the first time since April.
