Bobyleva A.Z. Modern investment and financial possibilities of Russian oil companies

Abstract: The article describes the priorities of investing in Russia’s oil industry and the financial possibilities of implementation of oil projects in the conditions of the current tax system, the decline of oil prices, the decline of the ruble’s exchange value and sectoral sanctions. The need for tax credits in the oil industry is viewed in connection with the main segments of the industry – exploration of oil deposits and production and refining of oil, as well as in connection with changes in the geography of production, the practicability of capital investments in large, medium-sized and small oil business and the opportunities of the development of the industry through its organic and non-organic growth. Analysis of financial sources for the expansion of investment activities allows the author to highlight the capabilities and limitations of the own and borrowed capital, as well as direct and indirect participation of the state in the financing of oil industry. The investments’ potential of the oil industry and its risks are estimated for the industry at large and in the context of the largest Russian companies in comparison with leading foreign companies. On the basis of this analysis, the author suggests some measures for the development of the investments’ potential. The author comes to the conclusion that the companies’ crisis management programs should be based on re-estimation of their investment portfolio: there should be a reduction of the share of expensive scavenger oil projects and an increase of the share of less costly energy efficiency projects. Besides, companies should also implement some measures for cutting down operational, investment and financial expenses and improve the efficiency of production. In its turn, the government should take decisive steps toward the new tax regime, which should provide an increase of correlation between the financial results and taxation and stimulate the reclamation of new oil deposits and advanced refining of oil. These new tax regulations should enable oil companies to make plans for the future.

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