Higher profits were not accompanied by higher investments in new projects, News
Oilmen state that the stability and predictability of the market suits them much better than high prices, which they cannot count on at the moment.
NIS plans to invest around 25 billion dinars in new projects in 2022.Greater profits and caution in investing – this is how 2021 could be briefly described for oil companies that traditionally announce their business results for the previous year in February.
These companies have reason to “rub their hands” with satisfaction because of the profits made in the past period. The oil giants that have so far announced business results in 2021 have reported significantly higher profits that will help them cover the minuses from the period of the strongest impact of the pandemic faster. Thus, for example, “Shell” made a profit of 20.1 billion dollars in 2021, while a year earlier it reported a loss of 21.6 billion. “Exonmobil” did even better, earning 23 billion dollars and thus compensating for the loss of 22.4 billion dollars in 2020. Norwegian “Equinor” had a profit of 8.6 billion dollars in 2021, while a year earlier it lost 5 billion due to the corona virus pandemic.
However, what worries analysts is the fact that significantly higher profits were not accompanied by proportionally higher investments in new projects. Experts warn that in the long run, that could mean fewer barrels of oil on the market, which again probably leads to maintaining high oil prices. Companies justify the absence of major investments by the fact that instability has not yet passed and that they face numerous obstacles that they cannot influence, such as geopolitical crises and the uncertain end of the pandemic. Although oil prices are at a seven-year high, oilmen state that the stability and predictability of the market suits them much better than high prices, which they cannot count on at the moment.
When it comes to the domestic market, the Oil Industry of Serbia will announce its business results for the previous year in the second half of February. What is gratifying is the fact that NIS had a net profit of 13.3 billion dinars in the first nine months of 2021, which compensated for the minus of 7.6 billion from the pandemic 2020. In addition, the company announced at the beginning of the year that the crisis will not affect plans to pursue substantial investments.
Thus, NIS plans to invest around 25 billion dinars in new projects in 2022. In addition, one of the priorities will be the implementation of the Agreement on Strategic Partnership in the Development of “Petrohemija”. Judging by the beginning of the year, the oil sector in the world and Serbia is facing an interesting and meaningful year, Politika writes.
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