* Romania’s natural gas demand will not recover * Electricity consumption will be relatively stable * OMV Petrom estimates an average oil price of USD 50-60/barrel
Romania’s natural gas demand will not recover in 2015, leading to growing competition and supplementary pressure on the margins, while the demand will be relatively stable on the electricity market and the prices will remain under pressure, OMV Petrom points out in a communiqué on the financial results it registered last year, a communiqué published on Thursday.
“We do not expect Romania’s natural gas demand to recover in 2015, which will lead to growing competition and to extra pressure on the margins. The regulated natural gas prices and the import obligation for the non-household sector were eliminated starting on January 2015, while the price of natural gas from national production paid by the regulated household sector in the first half of 2015 was set at RON 53.3/MWh (EUR 12/MWh), unchanged since 1 July 2014. The same price is applied to the volume of nationally-produced natural gas that Romanian producers are obligated to supply to the heating sector (only for the quantities used to produce heat for household consumption). Moreover, natural gas producers and suppliers have to sell on the free market, through centralized platforms in Romania, up to approximately a third of their own natural gas, which turned out to be a challenge in 2014,” the communiqué reads.
Likewise, “on the electricity market the demand is expected to remain relatively stable and the prices to remain under pressure,” and “in 2015 it is estimated that the refining margins will drop from the recent historic highs, as a result of the persistence of refining over-capacity on local and European markets.”
“The natural gas and electricity market, as well as the regulatory framework are going through a period of continuous change that could negatively influence the company’s financial and operational results,” the company points out.
On the other hand, OMV Petrom estimates that this year the average price of oil will register an average value of USD 50-60/barrel, with the lower prices of oil products being set to back the marketing demand in this context.
“For 2015 we expect the average price of Brent crude to register an average value of USD 50-60/barrel. The Brent-Urals differential is forecast to remain relatively small. As a result of the drop in oil prices, it is estimated that the lower prices of oil products will support the marketing demand, against the backdrop of enhanced competition,” OMV Petrom points out.