In 2014 the key driver of trends in the market for refining and petrochemical products was the developments in the oil market.
Key financial and operating data of the Downstream segment
|DOWNSTREAM, PLNm||2014||2013||2012||change||% change|
|Net other income/(expenses)1)||(4,861)||(211)||(561)||(4,650)||(2203.80%)|
|LIFO-based operating profit/(loss) before amortisation/depreciation (LIFO-based EBITDA) and impairment losses||4,210||2,407||4,724||1,803||74.90%|
|LIFO-based operating profit/(loss) before amortisation/depreciation (LIFO-based EBITDA)||(852)||2,407||4,036||(3,259)||-|
|LIFO-based operating profit/(loss) before impairment losses||2,802||774||3,064||2,028||262.00%|
|LIFO-based operating profit/(loss)||(2,260)||774||2,313||(3,034)||-|
1) Including impairment losses on non-current assets of PLN (-)5,062m and PLN (-)688m, recognised in 2014 and 2012 respectively, the former related predominantly to the ORLEN Lietuva Group: PLN (-)4,181m, Unipetrol Group: PLN (-)752m, Anwil Group (Spolana): PLN (-)64m, and Rafineria Jedlicze Group: PLN (-)42m, and the latter to Unipetrol Group.
The downstream market in 2014 was exposed to high volatility, driven by challenging macroeconomic conditions in the first half of the year and by steep oil price declines and rising model refining margins in the second half. The key driver of trends in the market for refining and petrochemical products was the developments in the oil market. Lower oil prices are a consequence of oil oversupply and excess extraction capacities that have built up during times of high prices (supported by OPEC), and are not a transitory phenomenon. In addition to that, deteriorating growth prospects for the eurozone, China, and the emerging markets have depressed demand for oil and liquid fuels.
Changes in crude oil prices [USD/bbl]