The average annual price of Brent crude oil will increase to approx. USD 120 / bbl in 2022, assuming the release of strategic oil reserves by the USA and weaker demand from China, PKN Orlen reported.
Refining margin – we expect that the imbalance in the fuel markets in Europe related to the elimination of fuel imports from Russia will increase the demand for fuels produced by European refineries, improve the use of refining capacity and contribute to the improvement of refining margins, according to results presentation from PKN Orlen.
The refining margin with B / U differential was 18.3 USD / bbl in Q1 2022; increase by 815% (y / y), Orlen reported.
Petrochemical margin – a factor supporting petrochemical margins is demand correlated with GDP growth and lower imports as a result of higher freight costs. On the other hand, high oil and gas prices limit the margin increase.
The petrochemical margin amounted to EUR 1,166 / t in Q1 2022, an increase by 11.7% (y / y).
In the case of natural gas prices, the company expects a double increase in prices (y / y) due to the Russian invasion of Ukraine, regulatory changes forcing the European warehouses to be filled to the indicated level, and Gazprom’s attempt to force payments for the gas in rubles.
Electricity – we expect electricity prices to increase to approx. PLN 730 / MWh (increase by approx. 85% y / y) as a result of the persistently very high gas and coal prices caused mainly by the geopolitical situation and high prices of CO2 emission rights.
Source: PKN Orlen and ISBnews
