[EC] Ecopetrol: Q3 2026 Earnings Preview on Output and Fuel-Subsidy Cash

Ecopetrol is Colombia's largest integrated oil and gas company: it produces crude and natural gas at home, runs two refineries and most of the country's oil pipelines, and through its controlled subsidiary ISA operates power transmission lines and toll roads across Latin America[1]. Ahead of its Q3 2026 earnings, the earnings calendar originally listed the release for 2026-11-11[2]; on November 9 the company said it would instead publish results for the Third quarter 2026 (three months ended September 30, 2026) after the US market close on November 12 and hold its earnings call on November 13[3]. In the latest disclosed quarter, the second quarter of 2026, Brent averaged $96.7 per barrel, 45% above a year earlier[4]; group revenue was COP 40.198 trillion, up 35%, EBITDA was COP 17.675 trillion with a 44.0% margin, and net income attributable to shareholders was COP 6.064 trillion, while group production fell 6.6% year over year to 705.8 thousand barrels of oil equivalent per day (kboed)[5]. On the second-quarter call, management kept its full-year production target of 730–740 kboed and gave a year-end range of COP 8–12 trillion for the Fuel Price Stabilization Fund (FEPC) receivable, assuming Brent of $84–90 per barrel and an exchange rate of COP 3,200–3,600 per dollar[6]; on the first-quarter call it said full-year organic capital spending was budgeted at $5.4–6.7 billion, with execution tracking toward the upper end[7]. Consensus compiled by Earnings Whispers on November 3 calls for third-quarter earnings of $0.62 per ADR on revenue of about $9.75 billion, against actual second-quarter figures of $0.82 and $11.13 billion; only one or two analysts cover the company, and other aggregators list ADR estimates between $0.53 and $0.62[8].

Three things matter most in these results. First, whether domestic output recovers from the blockades: parent-company Ecopetrol S.A. produced 582.7 kboed in the second quarter, down 2.1% year over year[9], and management said group output was back near 730,000 barrels per day by late June after the blockades were lifted[10]; Brazil's Brava Energia, whose controlling stake closed on August 17, is consolidated from the third quarter[11] and adds about 42 kboed to the group[6], so readers need to strip it out to see the organic recovery. Second, whether record refining margins can last: the integrated gross refining margin was $29.8 per barrel in the second quarter, more than double the $12.5 a year earlier[12], but the products basket rose 63.5% over the same period, far faster than the 43% rise in the crude basket[4], so the third quarter will help separate operational gains from external spreads. Third, how much of the profit actually turned into cash: second-quarter operating cash flow was only COP 6.961 trillion, below COP 10.046 trillion a year earlier, while the FEPC receivable rose from COP 4.2 trillion to COP 8.0 trillion in a single quarter[13]; whether the balance approaches the COP 12 trillion top of the range at the end of September determines whether the oil-price windfall lands on the income statement or gets parked on the balance sheet.

Company Background and Business Structure

Ecopetrol was founded in 1948 as Empresa Colombiana de Petróleos, is headquartered in Bogotá and trades on the New York Stock Exchange as ADRs under the ticker EC[14]. The Colombian state owns 88.49% of the shares and is the controlling shareholder, with majority voting rights at the shareholders' meeting to elect the board and a decisive say over dividend decisions[15]. According to its 20-F, the company is responsible for over 60% of Colombia's hydrocarbon production, owns most of the country's oil and gas transportation, logistics and refining systems, and holds a leading position in petrochemicals and gas distribution; through ISA it also runs power transmission, real-time power system management and the Barranquilla–Cartagena coastal highway concession[1]. On August 17, 2026, a wholly owned subsidiary completed the purchase of about 51% of the voting shares of Brazil's Brava Energia, giving Ecopetrol control[11].

The company reports four segments, and the two hydrocarbon segments generate most of the revenue but with very different profit profiles. Exploration and Production pumps oil and gas from heavy-oil fields in Colombia's Meta department, such as Rubiales, Castilla, Chichimene and Caño Sur, and from the Permian Basin in the United States; it averaged 745.3 kboed in 2025[16]. The segment's 2025 revenue was COP 71,052 billion, of which COP 44,828 billion came from third parties and COP 26,224 billion from transfers inside the group, and its operating income was COP 10,821 billion[17]. Refining and Petrochemicals consists of the Barrancabermeja and Cartagena refineries and polypropylene maker Esenttia; the two refineries have design capacity of roughly 250,000 and 210,000 barrels per day[14]. The segment's 2025 revenue was COP 64,699 billion, including COP 56,195 billion from third parties, yet it posted an operating loss of COP 811 billion[17].

The other two segments are smaller but provide steadier profit. Transport and Logistics moves crude and refined products for the group and third parties through pipeline companies such as Cenit and Ocensa; of its COP 15,337 billion in 2025 revenue, COP 12,695 billion came from inside the group, and operating income was COP 10,135 billion. Energy Transmission and Toll Roads, which is ISA, had revenue of COP 16,033 billion and operating income of COP 6,492 billion[17]. Group revenue from external customers was COP 119,694 billion in 2025[14], and over the past three years domestic sales averaged 48.5% of the total and international sales 51.5%, roughly half each[18].

Financial History and Current Position

The 2025 annual report shows that lower oil prices cut group revenue and profit for a second straight year. Group revenue fell from COP 143,189 billion in 2023 to COP 133,330 billion in 2024 and then to COP 119,694 billion in 2025, down 10.2%; operating income fell from COP 38,462 billion in 2024 to COP 26,679 billion, and net income attributable to shareholders fell from COP 21,061 billion in 2023 and COP 13,841 billion in 2024 to COP 10,488 billion, with price effects alone reducing 2025 revenue by COP 9,663 billion[14]. At the segment level, Exploration and Production operating income dropped from COP 20,819 billion in 2024 to COP 10,821 billion, a decline of nearly half[17]. Operating cash flow was COP 33,342 billion in 2025 and dividends paid were COP 11,717 billion[19], and the FEPC receivable fell to COP 3.03 trillion at year-end, its lowest level since the pandemic[20].

The 2026 quarterly results show profit rebounding sharply once Middle East tensions lifted oil prices. In the first quarter, Brent averaged $78.4 per barrel, group revenue was COP 28,625 billion, down 8.7%, EBITDA was COP 13,458 billion with a 47.0% margin, and net income was COP 2,887 billion[21]. In the second quarter, revenue rose to COP 40,198 billion, up 35%, EBITDA reached COP 17,675 billion, up 59%, and net income attributable to shareholders was COP 6,064 billion compared with only COP 1,811 billion a year earlier; first-half net income totaled COP 8,951 billion and EBITDA COP 31,133 billion[5].

The profit rebound did not turn into cash at the same pace, so the balance sheet absorbed more of the strain. Second-quarter operating cash flow was COP 6,961 billion, below COP 10,046 billion a year earlier; in the same quarter the group spent COP 4,207 billion on capital projects and paid COP 5,536 billion in dividends, and for the first half operating cash flow was COP 14,139 billion, capital spending COP 8,422 billion and dividends COP 6,038 billion, leaving cash and investment portfolio of COP 11,269 billion at the end of June[13]. Total group debt at June 30 was COP 104.9 trillion, about $30.5 billion, of which about $10.0 billion belonged to ISA; gross debt to EBITDA was 2.0 times, below the company's 2026 ceiling of 2.5 times[13]. At the end of the first quarter the ratio was 2.3 times, or 1.6 times excluding ISA[7].

Operating Model

Group external revenue comes from six lines, and all of them are highly sensitive to Brent, heavy-crude discounts and the peso. In 2025, crude exports brought in COP 40,086 billion, domestic refined-product sales at regulated prices, including FEPC compensation, COP 45,846 billion, refined-product exports COP 8,356 billion, natural gas COP 4,264 billion, transmission and toll roads COP 16,029 billion and transport services COP 2,642 billion; crude that Exploration and Production sells to the group's own refineries is eliminated on consolidation[14]. The 20-F sensitivity analysis shows that a $1 per barrel rise in Brent would have added about COP 1,310 billion to 2025 revenue and about COP 781 billion to operating income, while a 1% depreciation of the peso against the dollar would have added about COP 624 billion to operating income[19]. On the first-quarter call, management said a $1 per barrel move in Brent together with a COP 100 move in the exchange rate shifts full-year EBITDA by about COP 1.6 trillion and net income by about COP 800 billion[22].

Profit comes mainly from upstream, but transport and transmission provide a base that is less tied to oil prices. Of the group's COP 17,675 billion in second-quarter 2026 EBITDA, Exploration and Production contributed COP 9,452 billion, downstream COP 3,091 billion, transport COP 2,448 billion and transmission and toll roads COP 2,668 billion[23]. Below EBITDA come finance costs, with a net finance result of COP -8,528 billion in 2025[14]; from 2026, a 10% income-tax surcharge and a non-deductible one-time wealth tax raised the second-quarter effective tax rate to 37.2%[24]. Minority shareholders in ISA and other subsidiaries took COP 3,956 billion of the COP 14,444 billion in 2025 net profit, about 27%[14].

The FEPC timing gap sits between profit and cash flow, and it is the key to understanding this company's cash. Operating cash flow roughly equals EBITDA minus taxes paid and the increase in the FEPC receivable, plus or minus other working capital; FEPC compensation is booked as revenue and profit in the period, but the cash arrives only after the government approves each quarter and pays in cash or short-term Treasury securities. In the second quarter, the company received COP 1.0 trillion in short-term Treasury securities (TES) covering the balance outstanding at the end of the second quarter of 2025[13]; on September 30 the government ordered payment of COP 683.99 billion covering the third and fourth quarters of 2025[25], both showing collection typically lagging by roughly three quarters to a year. The Brava purchase used short-term bridge financing, and the refinancing plan and leverage impact were a focus of investor questions on the first-quarter call[22].

Industry and Competitive Position

Ecopetrol's crude is mostly heavy and is priced for export at Brent minus a quality discount, which makes the company especially sensitive to shifts in heavy-crude supply. As Venezuelan crude returned to key international markets in 2026, the company's crude discount widened from $3.71 per barrel in the second quarter of 2025 to $6.57 in the second quarter of 2026, offsetting part of the benefit of higher Brent[4]. At home, the company supplies about 62% of Colombia's natural gas demand and 38% of its LPG demand[6], and it is responsible for supplying gasoline and diesel at regulated prices.

Compared with a pure upstream producer, Ecopetrol's refineries and pipelines give it an extra layer of earnings when oil prices rise, but when domestic fuel prices are regulated, that extra earnings stream becomes cash only after the government pays. The FEPC mechanism smooths domestic fuel prices by using the gap between local producer income and international parity prices; its balance reached COP 20.5 trillion in 2023, and only after the government gradually raised gasoline prices, partly adjusted diesel prices and paid down historical balances did it fall to COP 3.03 trillion in 2025[20]. The available material does not include a line-by-line financial comparison with peers, so the assessment of competitive position here rests mainly on the company's own market shares, asset structure and policy environment.

Core Debates

With the blockades lifted, can Ecopetrol's domestic output get back to its annual target in the third quarter?

Exploration and Production is the core of group profit, so whether output returns to target directly sets the direction of most of the earnings. The segment earned operating income of COP 10,821 billion in 2025[17], and its second-quarter 2026 EBITDA was COP 9,452 billion, up from COP 5,915 billion a year earlier, with a 42.1% margin and a first-half total of COP 16,180 billion[23]. Group production was 705.8 kboed in the second quarter versus 755.5 a year earlier, with a first-half average of 715.5[5]; the first quarter was 725.2[21], and all of these sit below the full-year target of 730–740[6]. At the second-quarter crude basket price of $90.1 per barrel[4], every 10,000 barrels per day of lost output means roughly $83 million less crude sold in a quarter.

The company splits the second-quarter decline into three parts and treats the blockades as a recoverable one-off. By its account, Permian output fell 33.3 kboed in line with the investment plan, natural decline at gas fields such as Piedemonte and Bonga-Mamey cut gas and liquids by 13.7 kboed, and domestic crude fell 2.7 kboed; the plan to offset a natural decline rate of about 18% with growth at CPO-9, Caño Sur, Rubiales, Castilla and Chichimene was delayed as a result[9]. Management said the 76-day Meta blockade and power outages cost about 23,000 barrels per day in the first half, and that group output recovered to nearly 730,000 barrels per day by late June after the blockades were lifted[10]; the Permian partners also agreed to add 7 wells to the 2026 campaign beyond the original plan[6].

A recovery in output would reach the income statement through both volumes and unit costs, but an alternative reading holds that the second-quarter decline was mainly structural. Lifting the blockades and restoring power would let the heavy-oil fields resume production and drilling; as domestic crude output rises, more barrels go to export and to the refineries, and Exploration and Production revenue and EBITDA rise with them, while higher output also spreads fixed costs over more barrels. Second-quarter lifting cost in peso terms was COP 49,418 per barrel, against COP 50,260 a year earlier and COP 47,249 for the first half[26], and COP 49,449 for all of 2025[16]. The alternative view is that gas-field decline and the planned Permian slowdown account for most of the drop, with the blockades costing only about 23,000 barrels per day; if so, Ecopetrol S.A. output will struggle to exceed last year's level even with the blockades lifted, and the full-year target can be met only by consolidating Brava, which management said would contribute about 42 kboed for the 51% stake[6].

The answer to this debate lies in third-quarter parent-company output and group output excluding Brava. The first marker is whether Ecopetrol S.A. output rises above the second quarter's 582.7 kboed and approaches the 595.4 of a year earlier[9]; the second is whether group output excluding Brava reaches 730, because the first half averaged only 715.5 and the second half needs to average about 744 to reach the low end of the full-year range. In addition, peso lifting cost should fall as output recovers, and the company needs to say whether the 730–740 target includes Brava. If Ecopetrol S.A. output comes in below 582.7, or the company cuts the full-year target or switches to a Brava-inclusive basis, the decline was not a one-off caused by the blockades; management has also flagged that a possible El Niño drought in the second half could hit power and water supply and repeat the outage-driven losses[10].

Ecopetrol's refineries earned record margins in the second quarter. Can that carry into the third quarter?

Refining and Petrochemicals accounts for nearly half of group external revenue but has long earned thin profits, so its improvement matters a great deal for group earnings sensitivity. The segment's 2025 third-party revenue was COP 56,195 billion, yet it recorded an operating loss of COP 811 billion[17]. In the second quarter of 2026, combined throughput at the two refineries reached a record 438.6 thousand barrels per day, up from 413.3 a year earlier[27]; the integrated gross margin was $29.8 per barrel, against $12.5 a year earlier[12]; and downstream EBITDA was COP 3,091 billion, nearly 4.6 times the COP 665 billion of a year earlier, with a 12.4% margin and a first-half total of COP 4,992 billion, implying about COP 1,901 billion in the first quarter[28].

The company credits operational improvements for the record result, but external spreads were also unusually favorable. In 2025, the gross margin was $14.1 per barrel at Barrancabermeja and $11.9 at Cartagena[29]; in the first quarter of 2026 the integrated margin rose to $17.3[7], with throughput of 417.5 thousand barrels per day[21]. In the second quarter, Barrancabermeja's utilization rose from 69.5% a year earlier to 85.9%, and its throughput grew 11.4%[27]; Cartagena set a single-refinery record margin of $31.6 per barrel after completing major maintenance[12]. Still, the company's investment plan at the start of the year assumed average throughput of only 410–420 thousand barrels per day[30], and deferred maintenance could be concentrated in the second half.

Refining profit depends on spreads, throughput and cash costs together, and an alternative reading holds that second-quarter margins came mainly from external spreads. International diesel, jet fuel and gasoline spreads over crude set the margin per barrel, refinery availability and maintenance schedules set throughput, and the product of the two minus cash costs gives downstream EBITDA; the second-quarter refining cash cost was $6.65 per barrel, against $5.74 a year earlier[28]. The spread on the regulated domestic portion is compensated through the FEPC, so profit is booked at international prices while the cash waits for government payment. The products basket rose 63.5% year over year in the second quarter, far more than the crude basket's 43%[4], so short-term spreads created by restrictions in the Strait of Hormuz could on their own explain most of the margin; if spreads fall and margins fall in proportion, the contribution from operational improvements was limited.

The third quarter needs to be read through three numbers together: margin, throughput and downstream EBITDA. First, whether the integrated margin holds above the first quarter's $17.3, ideally at $20 or more; second, whether throughput stays above 430 thousand barrels per day or drops below 420 as deferred maintenance is made up; third, whether downstream EBITDA stays above the first quarter's roughly COP 1,901 billion[28]. If international diesel and jet fuel spreads fall and the margin drops below $17.3, or deferred maintenance bunched into the second half pulls throughput down, the second-quarter profit peak is unlikely to last.

How much of the oil-price windfall is getting stuck in the fuel-subsidy receivable?

The FEPC determines how much of the oil-price gain becomes usable cash, so it says more about the company's financial flexibility than profit itself. Second-quarter net income attributable to shareholders was COP 6,064 billion, up 235%[5], yet operating cash flow was only COP 6,961 billion, about 30% less than the COP 10,046 billion a year earlier, as the FEPC balance rose from COP 4.2 trillion to COP 8.0 trillion in one quarter[13]. The company has to pay capital spending, interest and dividends to the state in cash, so the larger the receivable, the more it relies on borrowing.

The company's year-end range and the government's payment record support a timing-gap reading, but the diesel price freeze keeps the balance growing quickly. Management guided to a year-end balance of COP 8–12 trillion, assuming Brent of $84–90 per barrel and an exchange rate of COP 3,200–3,600 per dollar, and projected a further COP 1–3 trillion of accruals in 2027[6]. Working from the change in the balance, second-quarter accruals were about COP 4.8 trillion, the COP 3.8 trillion increase plus the COP 1.0 trillion received during the quarter[13], compared with about COP 1.2 trillion of new accruals in the first quarter[7]. The government paid off the COP 683.99 billion for the second half of 2025 on September 30[25]; but the Rio Times reported that diesel pump prices have been frozen since June while the world diesel reference rose about 67% this year, and that the government plans to end the diesel subsidy only for private and some other vehicles, with no start date set[31].

The FEPC transmission runs from price gap to accrual to collection, and the larger the gap and the slower the payment, the wider the divergence between profit and cash. International diesel and gasoline prices minus regulated domestic ex-refinery prices, multiplied by domestic volumes, give the quarterly FEPC accrual, which is booked in revenue and profit and builds the receivable; it becomes operating cash flow only after the government approves it each quarter and pays in cash or TES. The alternative reading is that the rising balance is only a timing issue: the government has historically paid on schedule, and the new administration has named closing the fuel subsidy gap a priority, with possible changes to end-user fuel prices or pricing formulas[10]; if so, a higher third-quarter balance is not a problem in itself, and what matters is whether price adjustments take effect and cash flows back in 2027.

This debate offers three observable signals in the third quarter. The first is whether the FEPC balance at the end of September exceeds the COP 12 trillion top of the year-end range; the second is whether quarterly operating cash flow returns to the prior-year level; the third is whether the government announces a payment schedule for the 2026 accruals or a diesel price adjustment. If the balance breaks through COP 12 trillion early and cash flow keeps lagging profit, or gross debt to EBITDA moves from 2.0 times at the end of June (2.2 times a year earlier) toward the 2.5 times ceiling[13] and squeezes capital spending or dividends, the oil-price windfall is being absorbed to a large degree by the subsidy receivable.

Risks and Falsifiers

Control by the majority shareholder is the root of the risk that capital allocation and dividend policy shift with the political cycle. The Colombian state owns 88.49% of the shares and can direct board elections and dividend decisions; the company's policy since 2018 has been to distribute 40%–60% of adjusted net income, and the ordinary dividend for fiscal 2025 was COP 4,975 billion, or COP 121 per share[15]. The new administration has named closing the fuel subsidy gap a priority[10], which shows how policy choices pass directly into the company's cash. Changes to dividends or investment priorities would hit free cash flow and leverage directly; if new management keeps the 40%–60% dividend policy and the 2.5 times leverage ceiling, and no large non-operating spending pushed by the controlling shareholder appears, this risk has not materialized.

Currency and taxes both weighed on peso-denominated profit in 2026. The peso strengthened from an average of COP 4,199 per dollar in the second quarter of 2025 to COP 3,612 in the second quarter of 2026[26], and the currency effect cut second-quarter revenue by about COP 4.8 trillion[4]; the 20-F sensitivity shows that each 1% peso appreciation reduces operating income by about COP 624 billion[19]. On taxes, the 10% income-tax surcharge and the one-time wealth tax raised the second-quarter effective tax rate to 37.2%; the wealth tax totals about COP 1.155 trillion for the year, with COP 570 billion still to be recognized in the second half[24]. If the peso weakens back toward its 2025 average and the surcharge is lifted as oil prices fall, this pressure would ease noticeably.

Repeated community blockades and power outages are the most direct execution risk to the production target. Road blockades and grid failures in Meta and other producing areas cut output by about 23,000 barrels per day in the first half of 2026, and management has warned that El Niño could add to power and water risks in the second half[10]. At the second-quarter crude basket price of $90.1 per barrel[4], a loss of 23,000 barrels per day equals roughly $190 million of revenue per quarter, and lower output also raises lifting cost per barrel. If Ecopetrol S.A. output returns above 590 kboed in the third quarter and the company reports no new blockade-related losses, this risk has not materialized for now.

A fall in refining spreads could quickly erase the second-quarter downstream profit, and the segment still posted an operating loss for all of 2025. Second-quarter downstream EBITDA was COP 3,091 billion; a return to the COP 665 billion of a year earlier would cut quarterly EBITDA by about COP 2.4 trillion, about 14% of second-quarter group EBITDA[28]. Second-quarter margins were supported by diesel and jet fuel spreads driven by restrictions in the Strait of Hormuz, and normalizing spreads would pull refining profit back quickly. If the third-quarter integrated margin is at least $20 per barrel and downstream EBITDA is at least COP 2,000 billion, profit does not depend entirely on short-term spreads.

Both fuel price adjustments and FEPC payments are government decisions, which builds policy uncertainty into the company's cash collection. The gap keeps accumulating while diesel pump prices are frozen, and payment may be delayed or made in short-term Treasury securities, as the second-quarter collection was in TES[13]. Each COP 1 trillion of unpaid balance directly reduces operating cash flow by the same amount; at the top of the company's range, a COP 12 trillion year-end balance would equal about 36% of 2025 operating cash flow of COP 33,342 billion[19]. If the balance at the end of September is no higher than COP 10 trillion and the government announces a diesel price adjustment or payment of the 2026 portion, this risk would ease significantly.

What to Watch Next

• Domestic output recovery, parent output: Ecopetrol S.A. produced 582.7 kboed in the second quarter of 2026, against 595.4 a year earlier[9]. Watch whether the third quarter rises above 582.7 toward 595.4; a reading below 582.7 means the decline was not a one-off.
• Domestic output recovery, group output excluding Brava: 705.8 kboed in the second quarter and 715.5 for the first half[5]. The second half needs to average about 744 to reach the 730 floor; a cut to the full-year target or a switch to a Brava-inclusive basis would falsify the recovery case.
• Domestic output recovery, lifting cost: COP 49,418 per barrel in the second quarter[26]. Watch whether it falls as output recovers; higher output without lower unit cost would be a warning.
• Refining margins, integrated gross margin: $29.8 per barrel in the second quarter and $17.3 in the first[12][7]. Holding above $17.3, ideally at $20 or more, would support the case; a drop below $17.3 would falsify it.
• Refining margins, throughput and downstream EBITDA: 438.6 thousand barrels per day and COP 3,091 billion[27][28]. Watch for throughput above 430 and EBITDA above about COP 1,901 billion; throughput below 420 or EBITDA under the first-quarter level would falsify it.
• FEPC cash conversion, receivable balance: COP 8.0 trillion at the end of June, up from 4.2 at the end of March[13]. A balance above COP 12 trillion at the end of September would falsify the timing-gap reading.
• FEPC cash conversion, cash flow and leverage: second-quarter operating cash flow of COP 6,961 billion and gross debt to EBITDA of 2.0 times[13]. Watch whether cash flow returns to the prior-year level; leverage approaching the 2.5 times ceiling would be a warning.
• FEPC cash conversion, government payments and diesel prices: the COP 683.99 billion for the second half of 2025 was paid on September 30[25]. A diesel price adjustment or a payment plan for the 2026 portion, with the balance falling, would confirm the timing-gap reading.

Conclusion

Ecopetrol's profit is driven by Brent, domestic output and refining spreads, but what shareholders can actually receive depends on how fast FEPC cash comes back. In the second quarter of 2026, higher oil prices lifted group revenue 35%, EBITDA to COP 17,675 billion and net income attributable to shareholders to COP 6,064 billion[5], while group output fell 6.6% year over year, operating cash flow came in below the prior year and the FEPC balance nearly doubled to COP 8.0 trillion in a single quarter[13]. Gross debt to EBITDA is still 2.0 times, leaving room below the 2.5 times ceiling, but that room is being used at the same time by the subsidy receivable and the financing needs of the Brava purchase. The central unresolved relationship is whether improvements in domestic output and refining profit can turn into cash before spreads fall, rather than piling up further as receivables from the government.

Independent analysis of the company's fundamentals has been scarce since the second-quarter results. Rio Times reporter Juan Martinez wrote on October 6 that Colombia has frozen diesel pump prices since June while the world diesel reference rose about 67% this year, putting the annual subsidy bill close to $3 billion; the FEPC covers the gap, Ecopetrol supplies fuel below the reference price and the state repays later, and the government plans to end the subsidy only for private and some other vehicles, with no start date set[31]. This view bears directly on the FEPC debate: if the pump price freeze lasted through the end of the third quarter, the quarter's accrual is likely to be no lower than the second quarter's, and the balance risks breaking through the COP 12 trillion upper bound early; conversely, once subsidy reform takes effect, the balance would grow more slowly. This is one outside interpretation, and it does not contradict management's statement that the government has historically paid on schedule; the disagreement is over whether payments can keep pace with new accruals[10]. The output-recovery and refining-margin debates have drawn no independent third-party analysis in this period, and only one or two sell-side analysts cover the third quarter[8], so readers should treat this coverage gap as information in its own right.

The combination that would clearly strengthen the current understanding is group output excluding Brava back near 730 kboed, Ecopetrol S.A. output above 582.7 and refining margins holding near $20 per barrel, together with an FEPC balance that stays within COP 12 trillion, operating cash flow back at the prior-year level and a government announcement of a diesel price adjustment or a payment plan for the 2026 portion. Conversely, if parent output stays below 582.7, margins slip back under $17.3, the FEPC balance breaks through COP 12 trillion early and gross debt to EBITDA moves toward 2.5 times, the second-quarter profit peak came mainly from external prices, and cash is being absorbed by both the subsidy mechanism and the acquisition financing.

Sources

[1] EC 20-F filed 2026-04-30 business position · 2026-04-30 · 20-F · https://www.sec.gov/Archives/edgar/data/1444406/000110465926053172/ec-20251231x20f.htm

[2] Drillr earnings calendar 2026-11-09 EC Q3 2026 · 2026-11-09 · Drillr earnings calendar

[3] EC 6-K filed 2026-11-09 Q3 2026 results timing · 2026-11-09 · 6-K · https://www.sec.gov/Archives/edgar/data/1444406/000129281426005189/ex99-1.htm

[4] EC Q2 2026 results report prices · 2026-08-04 · quarterly-report · https://files.ecopetrol.com.co/web/esp/inversionista/reporte-2q-2026.pdf

[5] EC 6-K filed 2026-08-04 Q2 2026 results · 2026-08-04 · 6-K · https://www.sec.gov/Archives/edgar/data/1444406/000129281426004040/ex99-1.htm

[6] EC Q2 2026 earnings call 2026-08-04 · 2026-08-04 · earnings-call · https://www.ecopetrol.com.co/wps/portal/Home/en/investors/financial-results/quarterly-results

[7] EC Q1 2026 earnings call 2026-05-13 · 2026-05-13 · earnings-call · https://www.ecopetrol.com.co/wps/portal/Home/en/investors/financial-results/quarterly-results

[8] Earnings Whispers 2026-11-03 EC Q3 2026 preview · 2026-11-03 · Earnings Whispers(汇总分析师预期) · https://finviz.com/news/414427/ecopetrol-faces-a-lower-bar-as-street-braces-for-sharp-sequential-earnings-pullback

[9] EC Q2 2026 results report production · 2026-08-04 · quarterly-report · https://files.ecopetrol.com.co/web/esp/inversionista/reporte-2q-2026.pdf

[10] EC Q2 2026 earnings call 2026-08-04 production recovery and FEPC · 2026-08-04 · earnings-call · https://www.ecopetrol.com.co/wps/portal/Home/en/investors/financial-results/quarterly-results

[11] EC 6-K filed 2026-08-18 Brava closing · 2026-08-18 · 6-K · https://www.sec.gov/Archives/edgar/data/1444406/000129281426004274/ex99-1.htm

[12] EC Q2 2026 earnings call 2026-08-04 segments · 2026-08-04 · earnings-call · https://www.ecopetrol.com.co/wps/portal/Home/en/investors/financial-results/quarterly-results

[13] EC Q2 2026 results report cash debt and FEPC · 2026-08-04 · quarterly-report · https://files.ecopetrol.com.co/web/esp/inversionista/reporte-2q-2026.pdf

[14] EC 20-F filed 2026-04-30 · 2026-04-30 · 20-F · https://www.sec.gov/Archives/edgar/data/1444406/000110465926053172/ec-20251231x20f.htm

[15] EC 20-F filed 2026-04-30 controlling shareholder and dividends · 2026-04-30 · 20-F · https://www.sec.gov/Archives/edgar/data/1444406/000110465926053172/ec-20251231x20f.htm

[16] EC 20-F filed 2026-04-30 production and lifting cost · 2026-04-30 · 20-F · https://www.sec.gov/Archives/edgar/data/1444406/000110465926053172/ec-20251231x20f.htm

[17] EC 20-F filed 2026-04-30 segment results · 2026-04-30 · 20-F · https://www.sec.gov/Archives/edgar/data/1444406/000110465926053172/ec-20251231x20f.htm

[18] EC 20-F filed 2026-04-30 sales mix · 2026-04-30 · 20-F · https://www.sec.gov/Archives/edgar/data/1444406/000110465926053172/ec-20251231x20f.htm

[19] EC 20-F filed 2026-04-30 cash flow and sensitivity · 2026-04-30 · 20-F · https://www.sec.gov/Archives/edgar/data/1444406/000110465926053172/ec-20251231x20f.htm

[20] EC 20-F filed 2026-04-30 FEPC · 2026-04-30 · 20-F · https://www.sec.gov/Archives/edgar/data/1444406/000110465926053172/ec-20251231x20f.htm

[21] EC 6-K filed 2026-05-13 Q1 2026 results · 2026-05-13 · 6-K · https://www.sec.gov/Archives/edgar/data/1444406/000129281426003010/ex99-1.htm

[22] EC Q1 2026 earnings call 2026-05-13 sensitivity and Brava · 2026-05-13 · earnings-call · https://www.ecopetrol.com.co/wps/portal/Home/en/investors/financial-results/quarterly-results

[23] EC Q2 2026 results report E&P financials · 2026-08-04 · quarterly-report · https://files.ecopetrol.com.co/web/esp/inversionista/reporte-2q-2026.pdf

[24] EC Q2 2026 results report wealth tax · 2026-08-04 · quarterly-report · https://files.ecopetrol.com.co/web/esp/inversionista/reporte-2q-2026.pdf

[25] EC 6-K filed 2026-10-01 FEPC payment · 2026-10-01 · 6-K · https://www.sec.gov/Archives/edgar/data/1444406/000129281426004776/ex99-1.htm

[26] EC Q2 2026 results report lifting cost · 2026-08-04 · quarterly-report · https://files.ecopetrol.com.co/web/esp/inversionista/reporte-2q-2026.pdf

[27] EC Q2 2026 results report refining · 2026-08-04 · quarterly-report · https://files.ecopetrol.com.co/web/esp/inversionista/reporte-2q-2026.pdf

[28] EC Q2 2026 results report downstream financials · 2026-08-04 · quarterly-report · https://files.ecopetrol.com.co/web/esp/inversionista/reporte-2q-2026.pdf

[29] EC 20-F filed 2026-04-30 refining margins · 2026-04-30 · 20-F · https://www.sec.gov/Archives/edgar/data/1444406/000110465926053172/ec-20251231x20f.htm

[30] EC 20-F filed 2026-04-30 2026 investment plan · 2026-04-30 · 20-F · https://www.sec.gov/Archives/edgar/data/1444406/000110465926053172/ec-20251231x20f.htm

[31] Rio Times 2026-10-06 Colombia diesel subsidy · 2026-10-06 · The Rio Times · https://www.riotimesonline.com/colombia-diesel-subsidy-2026/