. Moreover, integrating into distribution can potentially reduce operating costs, primarily because a producer doesn't have to rely on negotiating and enforc ing a network of agreements by which it sells oil to intermediaries in other countries. Further, this vertical integration enables LUKOIL to smooth its profits by operating in the ever-changing portion going to production versus distribution. Concomitantly, LUKOIL has rebranded its acquisitions to gain uniformity in its image, which also helps to promote sales better.