Russia's Gazprom Neft, the oil business of state gas company Gazprom, said weak oil prices had driven a near 80% slump in second-quarter net profit to 22 billion roubles ($297m).
The group said it still planned to pay an interim dividend later this year as profits improve.
Russia's third biggest oil producer swung into a net loss in the first quarter of this year, suffering like many of its peers from a drop in crude prices.
Its chief executive Alexander Dyukov said that a deal to cut output between the Organization of Petroleum Exporting Countries and its allies had since helped boost prices, helping erase the group's first-quarter losses.
Brent crude prices have climbed to nearly $45 per barrel from their more than 20-year-lows below $16 per barrel seen in April, thanks to the deal which Russia's Energy Minister Alexander Novak called a "success" this week.
The earlier loss meant Gazprom Neft earned a modest 8 billion roubles for the first six months of this year.
It plans to pay dividends on nine-month results to make the payment stronger, a company official told a conference call.
The same official said the company plans to cut its capital expenditure by around 20% this year. Annual capex had been seen at around 380 billion roubles for the next two to three years, according to plans released last year.
Gazprom Neft said its revenue had fallen 37% year-on-year in the second quarter to 398.3 billion roubles, while free cash flow had turned negative at 76.9 billion roubles compared to 34.2 billion roubles a year ago.
