2013-02-01 01:57:26 - Recently published research from Business Monitor International, "Russia Oil & Gas Report Q1 2013", is now available at Fast Market Research
BMI View: A high level of investment will be required to maintain Russian oil output at close to recent record levels, putting pressure on the domestic industry and hindering global expansion. Gazprom faces similar challenges in developing sufficient gas to meet European and, possibly, growing Asian demand. There have been promises made to reform Russia's tax and regulatory system, upon which further development of the oil and gas sector hinges. The realisation of Russia's oil and gas potential thus lies in unlocking the political gridlock that has prevented much needed reforms from taking place.
The main trends and developments we highlight for Russia's oil & gas sector are:
* Russian oil production reached a post-soviet high of 10.29mn barrels per day
(b/d) in 2011 and is on track to achieving an even higher level in 2012, with output for the first nine months averaging 10.35mn b/d. This has exceeded the 10.34mn b/d targeted by the economy ministry for 2012. However, the ministry also warns that without further investment, output could flatline at 10.24b/d by 2020.
* BMI is forecasting average Russian production of 10.35mn b/d in 2012, with scope for an increase to 10.45mn b/d by 2016. However, we see output slipping from its 2016 peak to 10.20mn b/d by 2021.
* Oil consumption, which we estimate averaged 2.73mn b/d in 2011, should edge towards 3.15mn b/d by 2016 - providing export potential of 7.30mn b/d.
* With Russia having produced 662bn cubic metres (bcm) of gas in 2011, BMI's latest projections show output rising to 724bcm by 2016 - dependent on growth in European demand and opportunities arising in Asian markets. Gazprom expects that total exports will reach a recordhigh of 222bcm in 2012, but BMI believes these will not exceed 170bcm. This is particularly so with countries such as Ukraine and Poland seeking to take gas at the minimum level required in their take-or-pay long-term contracts with Gazprom. Our forecasts see gas exports hitting 199bcm by 2016, as domestic consumption reaches almost 526bcm.
* There will be considerable upside risks to our long-term forecasts for Russian oil and gas production and exports if the country manages to push through fiscal reforms that would significantly improve the country's business climate for foreign investment. This could help to speed up development of its underexplored offshore acreages - the Arctic and Caspian Sea - as well as its northern and eastern fields.
* Securing a gas supply contract with China could also push up its export numbers, though the current standstill in negotiations does not make us optimistic about the prospects of this materialising in the short-term.
Full Report Details at
Russia's dependence on oil prices leads to high volatility in the country's export revenues. Our assumptions of tight supply due to booming demand in emerging markets is clearly an opportunity for the country. At the time of writing we assume an OPEC basket oil price for 2013 of US99.10/barrel (bbl), falling to US$96.20/bbl in 2014. Global GDP in 2013 is forecast at 3.0%, up from an assumed 2.6% in 2012, reflecting some recovery in the US, though uncertainty with regard to the eurozone debt situation and an apparent Chinese slowdown will continue to hamper growth. For 2014, growth is estimated at 3.2%.
Partial Table of Contents:
- Russia Oil and Gas SWOT
Industry Forecast Scenario
- Oil And Gas Reserves
- Table: Russia Proven Oil & Gas Reserves And Total Petroleum Data - Historical Data And Forecasts, 2010-2016
- Table: Russia Proven Oil & Gas Reserves And Total Petroleum Data - Long-Term Forecasts, 2015-2021
- Table: Comparison Of Deals Netted With Rosneft
- Oil Supply And Demand
- Table: Russia Oil Production, Consumption And Net Exports - Historical Data And Forecasts, 2010-2016
- Table: Russia Oil Production, Consumption And Net Exports - Long-Term Forecasts, 2015-2021
- Gas Supply And Demand
- Table: Russia Gas Production, Consumption And Net Exports - Historical Data & Forecasts, 2010-2016
- Table: Russia Gas Production, Consumption And Net Exports - Long-Term Forecasts, 2015-2021
- Gas Developments
- Refining And Oil Products Trade
- Table: Russia Refining - Production And Consumption - Historical Data & Forecasts, 2010-2016
- Table: Russia Refining - Production And Consumption - Long-Term Forecasts 2015-2021
- Revenues/Import Costs
- Key Risks To BMI's Forecast Scenario
Country Oil & Gas Risk/Reward Ratings
- Russia Upstream Rating - Overview
- Russia Upstream Rating - Rewards
- Russia Upstream Rating - Risks
- Russia Downstream Rating - Overview
Regional and Country Risk/Reward Ratings
- Table: Central And Eastern Europe Risk/Reward Ratings
- Table: Upstream Risk/Reward Rating
- Table: CEE Downstream Risk/Reward Ratings
Russia Energy Market Overview
- Table: Upstream Projects Database
- Overview/State Role
- Licensing And Regulation
- Government Policy
- Table: Changes In MET Rates (RUB Per Mcm)
- International Energy Relations
- Gas Transit And Marketing
- Oil Transit
- Table: Key Upstream Players
Oil And Gas Infrastructure
- Oil Refineries
- Central Federal District
- North West Federal District
- Southern Federal District
- Volga Federal District
- Urals Federal District
- North Caucasus Federal District
- Siberia Federal District
- Far East Federal District
- Table: Refineries In Russia
- Oil Terminals/Ports
- Oil Pipelines
- LNG Terminals
- Gas Pipelines
- Executive Summary
Full Table of Contents is available at:
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