Lukoil: bigger than Rosneft

The investors' darling is prioritising high-margin upstream activities

Lukoil overtook Rosneft for the first time in late March to become Russia's largest oil producer by market capitalisation. But it may have just put a large target on its back. The independently-owned producer, which has been run by Vagit Alekperov since the Soviet Union collapsed, enjoyed a share price bounce in March after presenting its new long-term strategy to investors in London. Promises made by Alekperov to use revenue earned when oil is above $50 to pay investors drove its market value above those of both Rosneft and Gazprom. Lukoil has long been a darling of portfolio investors, due to its progressive dividend policy, Western-style management and by underlining how different it is t