Ecopetrol Drops on Government Plan to Boost Taxes
(Corrects type of tax in first paragraph.)
Ecopetrol SA (ECOPETL), Colombia’s state- controlled oil company, dropped to a three-month low as the government announced that oil companies will pay a higher withholding tax than that paid by agricultural and industrial businesses and as global crude prices fell.
Ecopetrol, the most heavily weighted stock on Colombia’s Colcap index, slid 3.5 percent to 4,295 pesos as of 12:22 p.m. in Bogota, set for the lowest price on a closing basis since Jan. 3. The shares have fallen 21 percent this year.
Commodity producers led global declines in emerging markets today after economic growth in China, the world’s biggest consumer of metals and energy, missed analysts’ estimates. Ecopetrol dropped further after the Colombian government announced the tax increases.
“The chatter from the ministers combined with a poor global environment for the oil sector is creating a perfect storm of pessimism,” Rupert Stebbings, the head of equity sales at brokerage Bancolombia SA (BCOLO), said in an e-mail.
Brent crude fell to its lowest level in nine months and West Texas Intermediate dropped below $90 a barrel after China reported the economy expanded 7.7 percent in the first quarter. That compares with the median estimate in a Bloomberg survey of 41 analysts for an 8 percent gain in gross domestic product.
Pacific Rubiales Energy Corp. (PRE), the operator of Colombia’s largest oil field, fell 2.3 percent to 36,760 pesos.
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