Crude oil industry. Case study of Russia.

Elena Pudova

Bachelor's thesis

Abstract:

Crude oil is the most important raw material used in modern society for the reason that it provides not only raw materials for fuel manufacture and energy, but also starting materials for plastics and other products. The economics of crude oil pricing is one of the most complex and variable mechanisms in the commodities market. A number of different factors affect it.The oil price can determine the economic situation of the state, its budget and trade balance, impact on the government revenues and oil and gas industry and other sectors of an economy. That is why it is important to follow and predict the global oil prices.The oil complex is a strategically important element in the economy of Russia and has great importance in the socio-economic development of the country.Russia is one of the world’s largest producers of crude oil. Russia’s economy is highly dependent on its hydrocarbons, oil and natural gas revenues account for more than one-third of the federal budget revenues hence the Russian economy is now highly dependent on oil and gas.The aim of the thesis is to understand the main determinants of crude oil price evaluate the impact of crude oil price volatility on the economic performance of Russia. The theoretical part describes factors influencing price of crude oil and fuel from the origin of crude oil over extraction and production process to the current market situation in the world. The practical part of thesis is focusing on crude oil market in Russia, its trends and policies. Furthermore, in the practical part a linear regression model of relationship between price of crude oil and GDP per capita in Russia is tested. It is found that there is a strong relationship between GDP per capita and average price of crude oil.

Keywords

Economic performance, GDP, Crude oil

Language used: English

Date on which the thesis was submitted / produced: 15. 3. 2019

Thesis defence

• Supervisor: doc. Ing. Mansoor Maitah, Ph.D. Ph.D.

Czech University of Life Sciences Prague

Faculty of Economics and Management

Bachelor programme / field:
Economics Policy and Administration / Business Administration