Spanish oil major Repsol posted on Tuesday a first-quarter net loss of €487 ($528) million, compared to a net profit of €608 ($659) million in the same period last year, Kallanish Energy reports.

The results reflect a sharp drop in oil and gas prices, as well as higher costs and a drastic decrease in demand triggered by Covid-19, the firm said. Gas demand under its Gas & Power segment declined by 20% year-on-year.

“The volatility of the international commodities prices has impacted the valuation of the company’s inventories to an extraordinary degree. A negative effect of €790 ($856) million has resulted in a net loss of €487 ($527) million euros in the first quarter,” the company said in its financial results report.

However, on an adjusted net income basis, Repsol surpassed analysts’ expectations by posting a €447 ($484.6) million profit – which is a 27.7% drop over last year’s results.

“Repsol’s integrated business model and its flexibility and resilience were fundamental in allowing its businesses to achieve solid results in this extremely adverse scenario,” it said.

CEO Josu Jon Imaz said the company’s resilience plan for this year will ensure robustness of balance sheet and the “solid” investment grade of the company. The plan is based on an average Brent price of $35 a barrel from April to December and a Henry Hub price of $1.8 per million British thermal units.

He also reiterated the company’s commitment to lead the energy transition to pursue its goal to achieve net zero carbon emissions in 2050. By 2025, Repsol expects to have 7.5 gigawatts of low-carbon generation capacity.

The company is also maintaining its shareholder remuneration at €0.55 ($0.60) per share.

This post appeared first on Kallanish Energy News.