Lower European Prices Hit Gazprom's Profit

Gazprom said Friday that profit fell 6.4 percent in the third quarter because of lower prices in Europe, its biggest market.

Net income dropped to 113.1 billion rubles ($4.6 billion), or 4.81 rubles a share, from 120.8 billion rubles, or 5.30 rubles, a year earlier, Gazprom said on its web site.

"I don't know why people were so pessimistic," said Tatyana Kapustina, an oil analyst at UniCredit Aton. "Gazprom is a safe haven because it's liquid, politically supported and has the benefits of strong prices and low taxation compared to oil."

Sales in the three months through September climbed 5 percent to 516 billion rubles, as prices rose for consumers in the former Soviet Union. The government is gradually raising domestic rates to European levels.

n The country's environmental watchdog said Friday that it was seeking to have two licenses held by Gazprom Neft withdrawn after a west Siberian production unit failed to implement environmental controls.

Gazprom Neft has not provided plans for environmental monitoring or oil-spill cleanup at two fields in the Khanty-Mansiisk autonomous district, the Federal Service for the Inspection of Natural Resources Use said.