Shares of Caspian Sunrise PLC (AIM:CASP) tumbled 10% to 2.76p in early trading as it warned of operational challenges due to ongoing Russian sanctions affecting the oil it produces in Kazakhstan and disruption to sourcing drilling consumables from China.
Due to this, the company said that it is unlikely to resume dividend payments in the near term, having suspended payment in June following the failure to receive a US$22.5 million payment from the sale of 50% of the Caspian Explorer.
The decision also reflects there being "a number of opportunities to increase longer term shareholder value by corporate actions", it said.
On the plus side, the company reported that the "encouraging start" to oil trading activities continued and the discount for oil produced in Kazakhstan and delivered via the Russian pipeline network has narrowed.
"While we remain cautious, limiting trading for the time being to oil produced on our own assets, we believe this new income stream will become increasingly important to the group in the coming years."