Main macroeconomic factors affecting performance results
The main factors affecting the Group’s performance results are as follows:
- change in market prices for oil and petroleum products;
- change in the RUB/USD exchange rate and inflation;
- change in the tariffs for the transportation of oil and petroleum products.
Сhange in market prices for oil and petroleum products
The price of oil and petroleum products on the global and Russian markets is the main factor that influences the Group’s performance results.
Petroleum product prices on the global market are primarily determined by the level of global oil prices, the supply of and demand for petroleum products and the level of competition on different markets. Price dynamics on the international market, in turn, influence prices on the domestic market. The price dynamics vary for different types of petroleum products.
A significant decline in oil and petroleum product prices on the international market over the 12 months of 2015 had a negative effect on the Group’s results. Part of the negative impact from the drop in international prices was offset by the growth in the USD exchange rate versus the RUB.
|International market (USD/barrel)|
|Urals oil (avg. Med and NWE)||96.94||51.49||(46.9)|
|Premium petrol (avg. NWE)||918.72||569.96||(38.0)|
|Naphtha (avg. Med and NWE)||825.28||450.05||(45.5)|
|Diesel fuel (avg. NWE)||854.41||500.70||(41.4)|
|Gasoil 0.2% (avg. Med)||837.77||486.26||(42.0)|
|Fuel oil 3.5% (avg. NWE)||518.48||247.49||(52.3)|
|Domestic market (RUB/T)|
|High-octane petrol||31 948||32 488||1.7|
|Low-octane petrol||28 071||28 435||1.3|
|Diesel fuel||27 764||28 944||4.2|
|Fuel oil||9 014||7 202||(20.1)|
Source: Platts (international market), Kortes (domestic market)
Сhange in RUB/USD exchange rate and inflation
The Group’s management has decided that the Russian rouble shall be the Company’s reporting presentation currency. The functional currency of each subsidiary shall be the currency of the economic environment in which the company is engaged in operations, which is the Russian rouble for most companies.
|Change in consumer price index (CPI), %||11.4||12.9|
|Average RUB exchange rate vs. USD for the period, RUB||38.42||60.96|
|RUB exchange rate vs. USD at the start of the period, RUB||32.73||56.26|
|RUB exchange rate vs. USD at the end of the period, RUB||56.26||72.88|
|Change in the RUB exchange rate vs. USD for the period (in USD), %||— 72.0||— 30.0|
Source: Company data