2016 GDP forecasts: 3.3% in Poland, 2.8% in the Czech Republic, 1.7% in Germany, and 3.2% in Lithuania.
Brent crude price – crude oil price in the base case scenario is expected to remain largely unchanged relative to the average price in 2015. Factors that may drive it up include higher demand, lower production, and greater geopolitical risks.
Model downstream margin – forecast decline in annual average margin compared with 2015, primarily as a result of lower margins on diesel fuel and petrochemical products. Despite the projected decrease, high margin levels are expected, supported by the favourable macroeconomic climate, i.e. low crude prices and higher fuel and petrochemical product consumption.
Expected market trends:
Expected increase in demand for fuel, both petrol and diesel fuel, in Poland and in the Baltic States, stabilisation of demand in the Czech Republic, and depressed demand in Germany.
Legislative changes:
Grey market for fuel – significant grey market continues to exist in Poland. Further regulatory actions taken to curb it may affect fuel consumption.
Mandatory stocks – gradual reduction of mandatory stocks from the equivalent of 68 days to the equivalent of 60 days in 2016 (approximately 0.3m tonnes).
NIT – in 2016, the NIT in Poland will remain unchanged at 7.1%. The NIT for PKN ORLEN will be reduced to 6.035%.
Turnover tax – work is underway to introduce a tax on retail turnover, including at service stations.
ORLEN Group’s investments:
Downstream: construction of the CCGT unit in Płock and the PE3 unit at Unipetrol.
Retail: adding 35 new sites to the service station network and rebranding of approximately 50 BLISKA stations in Poland; launch of 7 stations and rebranding of 13 stations acquired in 2015 by ORLEN Deutschland GmbH in Germany; inclusion of some of 68 stations acquired in the Czech Republic from Austria’s OMV to the Benzina network and their rebranding.
Upstream: ongoing optimisation of expenditure on production assets in Canada (60% of the planned capex) and in Poland (40% of the planned capex) in the context of the prevailing crude and gas prices.
