Oil price drops by one USD, Petro Vietnam loses 5,400 billion VND

Not only is there a loss in revenue, with every dollar decrease in oil prices, Petro Vietnam's state budget payment also decreases by 1,500 billion due to a decrease in consolidated profit after tax of 560 billion VND.

Vietnam National Oil and Gas Group (Petro Vietnam) stated that 2016 will continue to be a very difficult year due to the forecast oil price being lower than the planned oil price, supply exceeding demand, and this reality will directly impact PetroVietnam's revenue and profit targets next year.

Prestigious consulting organizations in the world predict that the price of oil in 2016 will be around 30-60 USD per barrel. Of which, the US Energy Information Administration (EIA) predicts the average price of oil for the whole year will be 50 USD per barrel and Wood Mackenzie predicts 52.3 USD. Meanwhile, the Russian Ministry of Finance believes that the price of oil in 2016 may be 40 USD per barrel and will hardly drop to 30 USD like this year.

According to PetroVietnam's calculations, if oil prices fall by one USD per barrel, the group's revenue will decrease by VND5,400 billion, its contribution to the state budget will decrease by VND1,500 billion, and its consolidated profit after tax will decrease by VND560 billion.

To cope with the options of reducing oil prices in 2016, PetroVietnam will review the overall cost of exploiting each mine, saving maximum operating costs and management allocation costs. This is to ensure state budget revenue and preserve PetroVietnam's capital. In addition, the group will review and reduce other fees by 10-20%.

In 2015, Petro Vietnam achieved oil production of 18.74 million tons, reaching the target more than a month ahead of schedule, exceeding the plan by 11.5%.

Gas production reached 10.67 billion m3, exceeding the annual plan by 9%. 2015 is also the year with the highest gas production since the beginning of gas production (1981) until now.

PetroVietnam supplied 22.03 billion kWh of electricity to the national grid, produced 1.67 million tons of nitrogenous fertilizer, exceeding the annual plan by 9.4%. Gasoline production reached 6.92 million tons, exceeding the annual plan by nearly 25%.

PetroVietnam's industrial production value in 2015 reached VND510,000 billion, exceeding the yearly plan by 14.4%, increasing by VND49 billion, equivalent to an increase of 10.6% compared to 2014. PetroVietnam's total revenue reached VND560,000 billion.

According to VNE