“Gazprom” has lowered the forecast on export price of gas in 2016

The average export price of gas at the end of 2016, which is calculated for the investment program “Gazprom” will be $170 for 1 thousand cubic meters, said at a press conference the Chairman of the Board “Gazprom” Andrey Kruglov. The company had previously forecast an average price of $199 for 1 thousand cubic M. Kruglov has explained, the adjustment of prices with changes in exchange rates and oil prices.

By the end of 2015 the average price of gas of “Gazprom” amounted to $234 per 1 thousand cubic m, follows from company materials. Thus, the company now expects a decline of 27% this year.

In the presentation, the company also stated that the realization of a stress scenario the price of gas could fall to $151 per 1 thousand cubic meters In February in the materials to the investor Day stress price was $169. The company has retained the assessment of the price of oil in 2016 to $50/barrel. and in a stress scenario of $35/bbl. On Wednesday on the London stock exchange Brent crude oil is trading at $49/bbl. And stress the value of the dollar in the investment program “Gazprom” reduced to 72.9 76.7 per rubles per dollar.

EBITDA Gazprom in 2016 in dollar terms will decline by 15-20% to around $25 billion, Kruglov added. In 2015, the adjusted EBITDA of the company amounted to 1,875 trillion rubles ($30.9 billion Forecast by revenue and profit, a top Manager did not give.

The volume of gas export to far abroad “Gazprom” expects at least 165 billion cubic meters in 2016, said the first Deputy head of the financial-economic Department of the company Igor Shatalov. In 2015, “Gazprom” has put in the far abroad of 158.6 billion cubic meters of gas. That is, the company expects growth in supply at least 4%. In the first half of 2016, according to “Interfax”, already supplies increased by 14.3%, to 85 billion cubic meters.

In late may, the Chairman of the Board “Gazprom” Alexander Medvedev said that the gas price has bottomed out: “We have already reached the price bottom, so if the price of oil will not fall, and the price of gas also rises”. A significant portion of export contracts “Gazprom” is tied to oil prices with a delay of 6-9 months. Due to low oil prices and export netback (export price minus transport) for the Russian gas in Europe is almost equal to the prices in Russia, said in an April report by Sberbank CIB.