Nov. 25 (Bloomberg) -- OAO Rosneft, Russia’s largest oil producer, expects profit to rise in the last three months of the year after a slump in crude prices and provisions for an antitrust fine drove down third-quarter net income.

“We can already see that the fourth quarter looks better than the third,” Peter O’Brien, vice president for finance and investment, said in a phone interview today. He declined to provide estimates. “It will obviously depend on prices.”

Net income fell 66 percent to $1.17 billion in the third quarter, the Moscow-based company said on its Web site. That missed the $1.43 billion median estimate of eight analysts surveyed by Bloomberg. Revenue fell 37 percent to $13 billion.

Rosneft shares declined 2.3 percent, the most in six days, to 248.85 rubles in Moscow today.

Rising output failed to compensate for a 40 percent drop in the oil price, which reached a record last year. Urals, Russia’s benchmark export blend, fell to an average $67.94 a barrel in northwest Europe in the third quarter, from $113.48 in the year- earlier period, according to data compiled by Bloomberg. Rosneft output rose 4.5 percent to 2.21 million barrels a day.

The creation of a reserve against $248 million of claims from Russia’s competition watchdog in the past two years cut into net income in the third quarter, the company said.

“There is a scenario where we have to pay part of it,” O’Brien said, declining to give the amount. “We’re confident that in the appeal process we can reverse these decisions.”

Not Disappointed

Rosneft’s $279 million of “other expenses” includes the provisioning, Artem Konchin, an oil analyst at UniCredit SpA said by telephone from Moscow today. “I don’t think the market will be disappointed,” he said.

Oil output growth next year will exceed the 2 percent target set for this year, O’Brien said. Rosneft expects to produce 112 million tons, or 2.25 million barrels a day, the company said in a Nov. 23 statement on its Web site.

The Vankor field will boost production to between 230,000 barrels a day and 270,000 barrels a day next year, O’Brien said. The field produces almost 180,000 barrels a day now after starting production in August, he said.

The state-run oil company will soon be able to benefit from a zero export duty on the northern Siberian field, O’Brien said.

“We should see some news any day,” he said.

Rosneft may sell OAO Transneft the pipeline from Vankor to the state pipeline operator’s main network at Purpe, as other oil companies, such as TNK-BP develop deposits in the region. The state asked Rosneft to evaluate the potential sale and cost of transportation after transferring ownership, O’Brien said.

Net debt was $18.9 billion as of Sept. 30, a decrease of $2.4 billion from the end of last year, Rosneft said.

Rosneft received $10 billion of a loan from China Development Bank Corp. by Oct. 31 to restructure debt, and has an additional $5 billion available to it next year, the company said. Repayment of $1 billion a year begins in 2014.

To contact the reporter on this story: Stephen Bierman in Moscow sbierman1@bloomberg.net.

Last Updated: November 25, 2009 11:56 EST