{"id":7665,"date":"2021-04-08T09:19:00","date_gmt":"2021-04-08T06:19:00","guid":{"rendered":"https:\/\/www.fpe.ro\/?p=7665"},"modified":"2024-11-20T11:12:22","modified_gmt":"2024-11-20T09:12:22","slug":"contributia-industriei-de-petrol-si-gaze-in-economia-romaneasca-2","status":"publish","type":"post","link":"https:\/\/www.fpe.ro\/en\/contributia-industriei-de-petrol-si-gaze-in-economia-romaneasca-2\/","title":{"rendered":"The oil and gas industry's contribution to the Romanian economy"},"content":{"rendered":"
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Author: Laurian Lungu, Co-founder<\/strong> Consilium Policy Advisors Group - CPAG<\/strong><\/p>\n

Romania's oil and gas sector has been a strong contributor to GDP growth for decades. However, in recent years, this contribution has started to slowly and gradually decline, triggered by a combination of factors, including economic factors such as declining reserve replacement rates or regulatory measures and policy changes, the latter taking place both domestically and at the European Union (EU) level. In recent years, in particular, there has been a gradual shift from policies that have supported oil and gas production to policies that focus on discouraging fossil fuels, encouraging the use of alternative technologies and fuels, in particular renewable energy. This trend has come at a time when lower oil and gas prices have put greater pressure on the sector's performance, particularly after 2014.<\/p>\n

The current pandemic crisis has exposed the oil and gas sector to future risks and uncertainties more disproportionately compared to other economic sectors. First, a slump in demand and transportation activities as a result of the introduction of restrictions has had a serious impact on oil and gas sector finances. Second, EU leaders recently set themselves a more ambitious climate target, committing to reduce greenhouse emissions by at least 55% by 2030 compared to 1990. This would increase short- and medium-term pressure on oil and gas companies to adopt measures to help them meet the new target. Moreover, it is well known that the Romanian oil and gas market has suffered from the fact that local legislation is changing at a rapid pace, without the effects of the changes being analyzed in extenso.<\/em>  What's more, European targets are increasingly weighing on the oil and gas sector, with international prices ranging from below $17 a barrel to over $74 a barrel.<\/p>\n

However, Romania, along with several other countries, has managed to negotiate a so-called \u201etechnology neutrality\u201d, which could give gas investments more leverage over the next decade. According to the European Council text, Romania could decide on its own energy mix to reach its 2030 climate target.<\/p>\n

An analysis carried out during 2020, which involves collating and interpreting data relevant to the Romanian oil and gas sector, shows that within the energy sector, the oil and gas industry remains an important contributor to Romania's GDP growth. Between 2017-2019 the oil and gas companies surveyed generated 1.8% of GDP, about half the contribution of the entire energy sector<\/strong>. The total taxes and dividends paid to the state by the oil and gas companies surveyed averaged 16 billion lei per year, equivalent to 6% of current government revenues. Only dividends averaged 2 billion lei. per year, representing 1.3% of government tax revenues<\/strong>. Thus, the total impact of the surveyed oil and gas companies on the economy (i.e., including direct, indirect and induced effects) is significant, accounting for between 5.3% and 5.9% of GDP over the period 2017-2019.<\/p>\n

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The oil and gas companies included in this survey paid 10 billion lei in VAT and fuel excise taxes in 2019. This is equivalent to 10.3% of the budget revenue that the government collected in VAT and excise duties<\/strong>. The ability of oil and gas companies to collect both VAT and excise duties and then transfer them to the state budget is a strong point, given that the total VAT gap rate of Romania's entire economy is currently around 34%, the highest in the EU.<\/p>\n

Labor productivity in oil and gas is more than four times the average labor productivity in the economy. This goes some way to explaining the relatively large indirect and induced impact that the oil and gas industry has on the economy.<\/p>\n

Between 2017-2019, surveyed companies in the oil and gas sector employed more than 24,800 people. This accounted for 0.5% of total employment in the economy, or more than 25% of cumulative employment in the energy sector.<\/p>\n

Last but not least, the analysis also reflects the fact that Romania's dependence on natural gas has increased significantly in recent years, from 2% in 2015 to 24% in 2019, with its current evolution indicating a future upward trend.<\/strong><\/p>\n

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\n\t\t\t\t\n\t\t\t<\/div> \n\t\t<\/div>\n\t<\/div> \n<\/div><\/div>","protected":false},"excerpt":{"rendered":"Author: Laurian Lungu, Co-founder Consilium Policy Advisors Group \u2013 CPAG Romania's oil and gas sector has been a strong contributor to GDP growth for decades. However, in recent years, this contribution has begun to decline...","protected":false},"author":2,"featured_media":7452,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[33,30],"tags":[],"class_list":{"0":"post-7665","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-articole","8":"category-noutati"},"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/www.fpe.ro\/en\/wp-json\/wp\/v2\/posts\/7665","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.fpe.ro\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.fpe.ro\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.fpe.ro\/en\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.fpe.ro\/en\/wp-json\/wp\/v2\/comments?post=7665"}],"version-history":[{"count":2,"href":"https:\/\/www.fpe.ro\/en\/wp-json\/wp\/v2\/posts\/7665\/revisions"}],"predecessor-version":[{"id":7672,"href":"https:\/\/www.fpe.ro\/en\/wp-json\/wp\/v2\/posts\/7665\/revisions\/7672"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.fpe.ro\/en\/wp-json\/wp\/v2\/media\/7452"}],"wp:attachment":[{"href":"https:\/\/www.fpe.ro\/en\/wp-json\/wp\/v2\/media?parent=7665"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.fpe.ro\/en\/wp-json\/wp\/v2\/categories?post=7665"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.fpe.ro\/en\/wp-json\/wp\/v2\/tags?post=7665"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}