Baku, Azerbaijan, Oct.12
By Emil Ismayilov - Trend:
The State Oil Company of Azerbaijan (SOCAR) sees no problems in the volatility of world oil prices, as the scenario of lower prices is also taken into account when forecasting the volume of revenues, SOCAR President Rovnag Abdullayev said on Oct.11.
He said the expenditures and investment program of SOCAR are adjusted depending on the oil prices.
Azerbaijan's state budget for 2014 was formed based on the oil price of $100 per barrel.
The average monthly price for Azerbaijani oil stood at $109 in Jan.-Sept. 2014. Experts forecast that if the price for Azerbaijani oil remains at the current level of $90-95 by late 2014, then the average annual price will not fall below $100.
The oil prices remained high and fluctuated around $100 per barrel starting from 2011.
Nevertheless a dramatic decrease was recorded in oil prices in 2014, as the prices dropped by 20 percent from June to October. Some experts believe that this may mean the beginning of a prolonged peak, which will last more than a month.
So, currently, the oil prices tend to fall from $115 per barrel in June to $92 in early October.
However the results of discussions and voting in OPEC during the summit in November, may have long-term effects in the formation of oil prices. If the organization's members agree to reduce the oil production, then the prices may increase again (or at least remain at the current level). However, if they fail to reach an agreement, it is highly likely that the oil prices will continue to drop.
OPEC countries, including Saudi Arabia, Iran, Iraq and Venezuela produce nearly 40 percent of the world's oil.
SOCAR's total revenues stood at 38.43 billion AZN as of 2013, compared to 17.14 billion AZN in 2012.
SOCAR received 8.95 billion AZN of its total volume of revenues from the sale of petroleum products, while 1.85 billion AZN fell to the revenues from the sale of petrochemical products.
SOCAR includes Azneft (a production association of enterprises that produce oil and gas on land and sea), Azerkimya (a production association of chemical industry enterprises) and Azerigas (deals with distribution of gas in the country).
The company also includes a number of processing and service enterprises, and institutions involved in geophysical and drilling operations.
SOCAR is the sole petroleum products manufacturer in Azerbaijan with two oil refineries. The company owns filling stations in Azerbaijan, Georgia, Ukraine, Romania and Switzerland.
It is also a co-owner of the largest Turkish petrochemical complex Petkim, and other assets in Turkey.
The official exchange rate on Oct.12 is 0.7843 AZN/USD.