Ecopetrol is projected to report a 40% reduction in net income for 2025, driven by a sustained drop in Brent crude prices and the appreciation of the Colombian peso. This earnings contraction will reduce dividend payments to the Colombian government by approximately $2.3 trillion COP, intensifying fiscal challenges amid ongoing budgetary pressures. Market observers highlight structural oversupply risks in global oil markets and subdued dollar levels that may keep this downward trend persistent in the near term.
Ecopetrol’s net profits are expected to fall sharply from 14.9 trillion COP in 2024 to an estimated 8.9 trillion COP in 2025, representing nearly a 40% decline. This deterioration corresponds to dividend payouts dropping from 7.8 trillion COP in 2024 to about 5.5 trillion COP, a reduction of 2.3 trillion COP, significantly impacting government revenues. The decline is primarily attributable to Brent crude’s average price falling to around USD 63 per barrel in Q4 2025, down from USD 74, USD 66, and USD 68 in earlier quarters, weakening export earnings despite stable production levels. Concurrently, the Colombian peso strengthened against the dollar, with the market exchange rate averaging 3,813 COP/USD in Q4 2025, compared to above 4,000 COP/USD in prior quarters. This currency appreciation reduces peso revenues per barrel sold internationally, compressing Ecopetrol’s margins and earnings.
Energy analyst Sergio Cabrales identifies these combined external pressures as key drivers behind Ecopetrol’s outlook, estimating Q4 2025 net income at 1.4 trillion COP or less. Internationally, overcapacity concerns exacerbated by expected output gains from Venezuela and Russia amplify competitive pressures and limit price recovery potential. Columbia University energy expert Felipe Bernal notes that these market conditions decrease investment incentives, which will weigh on Colombia’s fiscal resources since Ecopetrol is state-owned. Additionally, domestic monetary dynamics, including recent debt issuance and anticipated US Federal Reserve interest rate cuts, are expected to keep the dollar relatively low against the peso in the short term, further limiting Ecopetrol’s peso income from dollar-denominated sales.
To mitigate financial strain, analysts advise efficiency improvements and cost reductions without harming value generation. The anticipated earnings decline underscores Colombia’s vulnerability stemming from fiscal dependence on petroleum revenues amid an environment of volatile global oil prices and complex regional geopolitical factors.
