1Q 2011 Financial Results (US GAAP)

May 2011 Forward-Looking Statements

• Certain statements in this presentation are not historical facts and are “forward-looking”. Examples of such forward-looking statements include, but are not limited to: – projections or expectations of revenues, income (or loss), earnings (or loss) per share, dividends, capital structure or other financial items or ratios; – statements of our plans, objectives or goals, including those related to products or services; – statements of future economic performance; and – statements of assumptions underlying such statements. • Words such as “believes,” “anticipates,” “expects,” “estimates”, “intends” and “plans” and similar expressions are intended to identify forward-looking statements but are not the exclusive means of identifying such statements. • By their very nature, forward-looking statements involve inherent risks and uncertainties, both general and specific, and risks exist that the predictions, forecasts, projections and other forward-looking statements will not be achieved. You should be aware that a number of important factors could cause actual results to differ materially from the plans, objectives, expectations, estimates and intentions expressed in such forward-looking statements, including our ability to execute our restructuring and cost reduction program. • When relying on forward-looking statements, you should carefully consider the foregoing factors and other uncertainties and events, especially in light of the political, economic, social and legal environment in which we operate. Such forward-looking statements speak only as of the date on which they are made, and we do not undertake any obligation to update or revise any of them, whether as a result of new information, future events or otherwise. We do not make any representation, warranty or prediction that the results anticipated by such forward-looking statements will be achieved, and such forward-looking statements represent, in each case, only one of many possible scenarios and should not be viewed as the most likely or standard scenario.

1 1Q 2011 Financial Highlights

• Net income – $3,517 million ( +71.3% y-o-y)

• Basic earning per share – $4.5 (+85.6% y-o-y)

• Net Income per boe of production – $17.9 per boe (+78.8% y-o-y )

• EBITDA – $5,343 million (+43.3% y-o-y)

2 Macroeconomic and Tax Environment

1Q 2011 to 1Q 2010

Diesel fuel (Europe), 41.6% Positive factors

Negative factors R Diesel fuel (Russia), 38.7% E V Urals, 36.2% E N Fuel oil (Russia), 30.3% U Gasoline (Europe), 27.0% E Fuel oil (Europe), 26.1%

Gasoline (Russia), 12.1%

E Transneft tariffs, 12.3%

X Real rouble appreciation, P 11.8% E Railway tariffs, 7.7% N S Freight rates (petroleum E products), 2.9% Freight rates (crude oil), S 1.9% T Mineral extraction tax ($), A 45.1% X Crude oil export tariff, 30.1%

3 -20% 0% 20% 40% 60% 80% Main Operating Results

1Q 2011 to 1Q 2010

Hydrocarbon production, -4.1%

Marketable gas production, 1.4%

Refinery throughput*, -1.0%

High-octane gasoline production, 7.8%

Crude oil exports, -16.4%

Petroleum product exports, -9.4%

Domesticl sales of petroleum products, 2.3%

4 -19% -13% -7% -1% 5% 11% 17% * Including mini-refineries and the Company’s share in throughputs of oil and petroleum products at the ISAB and TRN refining complexes. Financial Results

1Q 4Q 1Q 1Q Δ , % $ million Δ , % 2011 2010 2011 2010

29,626 28,684 3.3 Sales 29,626 23,902 23.9

(2,138) (2,133) 0.2 OPEX (2,138) (1,988) 7.5

Taxes other than income tax (7,436) (7,262) 2.4 (including excise and export (7,436) (6,658) 11.7 tariffs)

3,872 3,008 28.7 Income from operating activities 3,872 2,651 46.1

4,070 2,877 41.5 Incomebeforeincometax 4,070 2,565 58.7

3,517 2,186 60.9 Net income 3,517 2,053 71.3

4.50 2.80 60.7 Basic EPS, $ 4.50 2.42 85.6

5,343 4,064 31.5 EBITDA 5,343 3,729 43.3

5 Sales Breakdown, $ million

35,000 Domestic market Other sales* International market 29,626 30,000 Sales of electricity in Russia 16% 23,902 +28.9% 25,000 Sales of gas in Russia

16% Sales of petrochemicals in Russia 20,000

Sales of crude oil in Russia +23.0% 15,000 84% Sales of petroleum products in Russia 84%

10,000 International sales of gas

International sales of petrochemicals 5,000

International sales of crude oil

0 International sales of petroleum products 6 1Q 2010 1Q 2011 * Including international sales. LUKOIL Increases Production of High-Octane Gasoline

Refinery throughputs reconciliation Refining margin of a Russian (y-o-y), th. barrels per day* cracking refinery, $ per barrel 25 +31 -16 1,280 2010 20 2011 -13

1,260 15 -9 1,250 -5 0 1,238 10 1,240 -1,0% -12 th. barrels per day 5 1,220 1Q 2010 Burgas Odessa ISAB TRN Petrotel Russian 1Q 2011 0 Refinery Refinery refineries Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Production of high-octane gasoline in Russia, mln tons

1.4 1.39 In 1Q 2011 LUKOIL decreased refinery throughput due to

1.3 1.29 scheduled maintenance at the ISAB Complex in 1Q 2011 and stop of

1.2 refining at the Odessa Refinery due to unfavorable economic conditions

1.1 1Q 2010 1Q 2011

7 * Including mini-refineries and the Company’s share in throughputs of oil and petroleum products at the ISAB and TRN refining complexes. Operating Expenses

1Q 4Q 1Q 1Q 2011 2010 Δ, % $ million 2011 2010 Δ, % 853 853 0.0 Hydrocarbon lifting costs 853 784 8.8

342 310 10.3 Own refining expenses 342 273 25.3

Refining expenses at third-party 169 190 -11.1 169 179 -5.6 refineries, ISAB and TRN Expenses for crude oil transportation to 232 246 -5.7 232 266 -12.8 refineries Power generation and distribution 188 202 -6.9 188 148 27.0 expenses 68 83 -18.1 Petrochemical expenses 68 40 70.0

286 249 14.9 Other operating expenses 286 298 -4.0

2,138 2,133 0.2 Total 2,138 1,988 7.5

Cost of purchased crude oil, gas and 12,845 12,248 4.9 12,845 9,302 38.1 products

8 Operating Expenses

Lifting costs, $ per boe

6

5 4.5 4.4 4.1 4.0 4.1 4.1 1Q 2011 operating expenses increased 4 3.7 3.4 3.1 by 7.5% y-o-y , meanwhile real rouble 3 appreciation was 11.8% 2 1

0 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2009 2009 2009 2009 2010 2010 2010 2010 2011

2,200 +2.0% -1.7%

-0.7% 2,150 +3.5% 2,138

2,100 +4.4%

2,050 +7.5% $ million $ 2,000 1,988

1,950

1,900 2011 2010 power Increase in Increase crude oil crude lifting costs lifting OPEX in 1Q in OPEX OPEX in 1Q in OPEX Other OPEX Other expenses expenses Decrease in Decrease to refineries Increase in Increase distribution expenses for refining and refining transportation 9 and affiliated petrochemical generation and generation Increase in own in Increase Program of Energy Efficiency

OPEX structure in E&P segment Lifting costs, $ per boe

5.0 Power generation

4.5 20% Salary +18.4% -2.7% 25% 4.12 -3.4% Overhaul 4.0 7% Increase of oil recovery 3.56 12% 8% Materials 3.5 6% 16% Transport service 6% 3.0 Exploitation expenses

Other 2010 2011 other in 2009 in in 2010 in energy energy tariffs and increase of increase Lifting costs Lifting costs Program of Program Real rouble Program of Program appreciation, efficiency for efficiency efficiency for efficiency

LUKOIL Program of Energy Efficiency is designed to resolve main problems:

- decrease share of power generation expenses in total operating expenses - increase energy efficiency per unit

10 SG&A and Transportation Expenses

Transportation expenses (1Q 2011 to 1Q 2010) SG&A expenses, $ million

1,100 2% 1,001 -18% 878 908 -12% 791 902 900 853 802 825 8% 729 700 -4%

12% 500

-3% 300 -40% -30% -20% -10% 0% 10% 20% 30% 40% 1Q 2009 3Q 2009 1Q 2010 3Q 2010 1Q 2011

Transportation volume Tariff

1Q 4Q 1Q 1Q Δ , % $ million Δ , % 2011 2010 2011 2010 1,420 1,439 -1.3 Transportation expenses 1,420 1,351 5.1 Selling, general and administrative 825 1,001 -17.6 825 802 2.9 expenses 2,245 2,440 -8.0 Total 2,245 2,153 4.3

11 1Q 2011 Net Income Reconciliation

6 000

5 000 240 -778 180 2,181 -150 4 000 -117 -92 3,517

3 000 $ mln 2,053 2 000

1 000

0 expenses Increase inoperating Recalculation of the Net income in 1Q 2011 Net income in 1Q 2010 Increase in income tax Increase in SG&A and extraction tax incentive incentive tax extraction affiliates, decrease in decrease affiliates, transportation expenses transportation Increase in taxes other Net increase in revenue* in increase Net excise and export tarrifs) than income tax (including tax income than Increase in equity share in 12 other and interest expense * Change in revenue less purchases of oil and gas and petroleum products. 1Q 2011 Cash Flow Reconciliation

Free Cash Flow, $ million 2,013 7,000 2,000

-1,778 3,715 1,405 6,000 1,500

1,000 5,000 1Q 2010 1Q 2011 -1,702

4,000

$ million 3,000 -103 2,500 2,368

2,000

1,000

0 2011 Other outflow 2011 activities Acquisition of controlling interests Cash at the end of 1Q of end the at Cash subsidiaries and non- 13 Capital expendoitures Cash atCash of the beginning Cashflow from operating CAPEX Breakdown

1Q 4Q 1Q 1Q Δ ,% $ million Δ , % 2011 2010 2011 2010

1,417 1,459 -2.9 Exploration and production 1,417 1,117 26.9

1,185 1,224 -3.2 Russia 1,185 862 37.5

232 235 -1.3 International 232 255 -9.0

227 477 -52.4 Refining and marketing 227 228 -0.4

171 328 -47.9 Russia 171 160 6.9

56 149 -62.4 International 56 68 -17.6

14 17 -17.6 Petrochemicals 14 23 -39.1

7 10 -30.0 Russia 7 2 250.0

7 7 0.0 International 7 21 -66.7

50 122 -59.0 Power generation 50 89 -43.8

14 50 -72.0 Other 14 11 27.3

1,722 2,125 -19.0 Total (cash and non-cash) 1,722 1,468 17.3 14 Western Siberia: Production Trend is Constant

Production stabilization (y-o-y), LUKOIL-Western Siberia • Application of modern EOR methods while developing tight reservoirs 1Q 2007 2008 2009 2010 2011 2011F 2012F 2013F 0% -1% • Application of modern development -2% systems at mature fields with high -3% -4% -4.0% watercut -4.3% -5% -6% -5.4% -5.1% -7% -6.2%

Average flow rate, LUKOIL Western Siberia, barrels per day 500 440 437

400 298 300 236 Flow rates of horizontal wells are 2-3 180 180 200 higher than those of conventional ones 100

0 2009 2010 1Q 2011

A verage flow rate of all new oil wells A verage flow rate of horizontal oil wells 15 Efficiency Increase in E&P Segment

New wells efficiency in Russia

50% 308 300 LUKOIL increases field development efficiency due to growth of 236 % 30% 31.7% horizontal drilling: 200 29.2% barrels per day

100 10% - Share of horizontal drilling in total 1Q 2010 1Q 2011 drilling reached 25% Average daily oil flow rate, barrels per day Watercut, %

Exploitation drilling in Russia - Average daily oil flow rate of a new 600 well increased by 31%

40% 550 550 538 % 24.8% - Watercut decreased by 8% th. meters th. 20% 500

8.6% 450 0% 1Q 2010 1Q 2011

Exploitation drilling, th meters Share of horizontal drilling in total drilling, % 16 Techniques of Stabilization and Intensification of Production

Drilling of new exploitation wells 100% • Underbalanced drilling 80%

60% • Completion with expanding 40% packers 20% • Multiple completions 0% 2007 2008 2009 2010 2011F 2012F 2013F Vertical Horizontal • Infill drilling • Horizontal drilling • Decrease watercut Extension of reserves due to enhance recovery methods • Decrease of injection pressure 120 107 19 lower than of fracturing one’s 100 11 6 • Decrease of bottom-hole 80 52 pressure 60 • Multi-zone hydrofracturing

40 19 20

0 Side-tracks Hydrofracturing Re-completions Multiple Shut-in Total completions

17 Drilling and completion technologies development

•At Tevlinsko-Russkinskoye field (2 fracs per Addition to reserves, th. barrels well) a flow rate was reached at 1,300 2,500 2,250

barrels per day (2010 - 120 barrels per day) 2,000

1,500 •At Urievskoye field (4 fracs per well) the 1,018 1,000 flow rate was reached at 700 barrels per day 601 403 (2010 - 170 barrels per day) 500 0 2010 2012-2021F •At Kechimovskoye field (underbalanced Addition to reserves per 1 new well drilling) the flow rate was reached at 650 Addition to reserves per 1 new horizontal wells barrels per day (2010 - 160 barrels per day)

Allocation of horizontal wells by complexity of completions

2010 2011-2012 1% Simple horizontal wells

Simple horizontal wells 42% Wells with multiple fracs (14- 20 intervals) 52% Duplex wells

Multiple completions Wells with multiple fracs (14- 20 intervals) 2% Wells with multiple fracs (4-5 18 99% 2% 2% intervals) 18 Yuzhnaya Khylchuya field

Revision of field reserves, mln barrels Field production, mln barrels 500 -62.6% 53 400

300 43 505 33 200 371 316 100 23

0 13 01.01.2009 01.01.2010 01.01.2011 2009 2010 2011F 2012F 2013F Forecast in 2009 Current forecast and production

• Production at the Yuzhnaya Khylchuya field in 1Q 2011 decreased to 8.3 mln barrels (-38% y-o-y) Main reasons for production decrease: • Decrease of original oil-in-place

19 New opportunities in Nenetsky Autonomous District

Partnership agreement with Bashneft suggests: - joint development of R.Trebs and A.Titov fields R. Trebs Field - Oil transport via the Varandey Oil Export Terminal - supplying the produced associated A. Titov Field petroleum gas to the energy centre of the Yuzhnaya Khylchuya field

Oil reserves, mln tons

Field А+В+С1 С2

A. Titov 51.1 6.5

R. Trebs 89.7 50.3

Partnership agreement with Bashneft for joint development of R.Trebs and A.Titov fields will allow Company to increase production in Russia and use efficiently the Varandey Oil Export Terminal infrastructure 20 Partnership with Rosneft – Development of Projects with Strategic Reserves

R u s s i a

Company and Rosneft stipulated an agreement on long-term partnership suggesting:

- joint exploration of the Arctic shelf with total profitable hydrocarbon resources of 30 bln boe - joint development of Rosneft’s fields in Timan-Pechora with total recoverable oil reserves of 1.5 bln barrels - joint gas transport from Vankor field and Bolshekhetskaya Depression

21 Robust Financial Position

$ per boe Total debt per boe, $ per boe

80 LUKOIL’s debt position is equally strong in 60 relation to its capital structure, 40 hydrocarbon production and EBITDA

20 generation

0 2007 2008 2009 2010 1Q 2011 Oil & gas majors LUKOIL

Net debt to EBITDA Debt-to-capital ratio, % % 1.5 50

1.25 40 1 30 0.75 20 0.5 10 0.25 0 2007 2008 2009 2010 1Q 2011 0 Oil & gas majors LUKOIL Average majors 2007 2008 2009 2010 1Q 2011 LUKOIL Average majors

Oil & Gas majors include ExxonMobil, Royal Dutch Shell, BP, ConocoPhillips,Total, Eni, Repsol YPF. 22 Source: Companies’ financial statements. Robust Competitive Position in the Industry

Net income per boe, $ per boe 40 1Q 2011 E&P CAPEX, $ per boe 36 21 18.3 32 18.8 18.3 18 28 15.9 24 15 20 12 11.1 9.9 16 9 7.2 7.0 12 4.9 4.6 8 6 4 3 0 0 2003 2004 2005 2006 2007 2008 2009 2010 1Q BP 2011 Eni Oil & gas majors LUKOIL Shell LUKOIL TNK-BP Rosneft Chevron ExxonMobil Gazprom neft 1Q 2011 Free Cash Flow, bln USD ConocoPhillips 11 9.8 9 % 7 ROACE*, % 35 5 4.5 3.2 30 3 2.0 1.8 1.1 25 1 0.0 -0.1 -0.9 20 -1

Eni 15 Shell

-3 neft LUKOIL TNK-BP Phillips Conoco

Rosneft 10 Gazprom

-5 YPF Repsol ExxonMobil 5 2003 2004 2005 2006 2007 2008 2009 2010 * Oil & gas majors LUKOIL 23 Oil & Gas majors include ExxonMobil, Royal Dutch Shell, BP, ConocoPhillips,Total, Eni, Repsol YPF. Source: Companies’ financial statements. Strategic Objective – Creation of Value by Increasing Recovery Rate

Due to implementation of new Recovery Rate Targets technologies and changing of the field

45% development system:

40% • resource base will increase by 9 40% billion barrels

35% 32% • extra production will amount to 700 million barrels 30% • extra EBITDA* will be $10 billion 25%

20% 19% Majors LUKOIL

15% Final recovery 45-50 32 10% rate, %

5% Current recovery 35-40 19 rate, % 0% A chieved Final audited Target

24 * - Calculated on the basis of the oil price of $90 per barrel. Conclusion

Financial and Investment Policy Highlights:

- Investment policy focuses on the development of E&P segment, increase of E&P share in total CAPEX

- Continuing modernization of Russian refineries under new tax regime

- Increasing efficiency of operating activities, cost control, and OPEX optimization

- Maintaining conservative financial policy, keeping access to domestic and international financial sources comfortable and open

- Maintaining strong financial discipline

25