| 摘要 | ABSTRACT
1. Research Purpose
From the advent of current depressed oil price era, one should take particular note of the possibility that the paradigm governing the international oil market may have been shifting. As the crude oil price is influenced by various factors, the sustained low price with elevated price volatility can be interpreted as that some fundamental changes are taking place in the international oil market. Such paradigm shift in the oil market, if it is indeed happening, can cause extensive and pervasive environment changes in virtually all energy industries. As such, close monitoring and continuous analysis for the sign of paradigm changes in market are necessary, especially for Korea which has a high overseas dependency for its energy supply.
Some signs of fundamental changes in the international oil market are reflected in the changing oil supply dynamics caused by the weakened OPEC��s solidarity, and also in the anticipation of oil sector bracing for structural changes from ensuing M&As expected. The increase in oil production in North America has reduced the influence of OPEC in the international oil market, and this can further work as an element that eventually brings forth changes to underlying dynamics of the crude oil market. Moreover, sustaining low oil price has deteriorated financial status of oil companies and forced them to adopt changes in their growth strategies. This has triggered repositioning of oil companies in their strategic development focus, as witnessed by the mega-merger between Shell and BG in 2015. Independent E&P companies are especially hit hard financially and becoming the targets of takeovers, signalling that further reshuffling is yet to come if the low oil price persists. In addition, the world crude oil trade structure is also undergoing a change as the US transforms itself from a crude oil importer to an exporter with the help of tight oil production.
Changes in the international oil market paradigm can have significant impacts on the overall economy of Korea. As the Korean oil refining and petrochemical industries are highly dependent on exports, their profits are largely determined by the degree of competition in the international market. The ongoing changes in the international crude oil market are likely to result in fiercer competition in the export markets for oil refining and petrochemical industries, and this will negatively affect them in terms of securing stable profits and long-term growth. As such, it is necessary to take proactive measures for the Korean oil industry in preparation for the anticipated changes. Also, the overseas upstream development facilitation policies of Korea need to be reexamined, as the sustaining low oil prices have also changed the business environments surrounding the upstream E&P activities.
The purpose of this study is to analyze and forecast the structural changes of the international oil market, to examine their impacts on the Korean oil industry, and finally to develop strategies for the long-term growth of the Korean oil industry under the changing environments.
2. Research result and policy suggestions
The changes in the international oil market can be summarized in the following two ways. First, low oil prices in the international oil market are likely to remain for a extended period of time. Under the current diversified oil supply sources which resulted in current low oil prices, if oil price rises, the increase in crude oil production is likely to be followed. This will inhibit further rise in oil prices to some degree. Such phenomena are attributable to supply-side factors such as improved shale oil productivity in North America and weakened OPEC��s cartel solidarity, mixed with such demand-side factors as increased energy efficiency, reduced demands for fossil fuels due to climate change negotiations, and heightened uncertainty of the global economy.
Second, even if the international oil price rises gradually, oil price volatility will be magnified and uncertainty about the oil industry will be increased. The financialization and speculation trends in the oil trade are likely to continue. The increase in unconventional oil production with shorter production cycles will also contribute to the volatility of the crude oil prices.
These changes in crude oil market are affecting the business environments of oil-related industries. The paradigm shift in crude oil market brought forth by the expansion of unconventional oil production will have negative impacts on the upstream E&P industry. Sustaining low oil prices will deteriorate profitability and the investment environment of E&P projects, and this will facilitate restructuring of the industry through M&As in an efforts to rationalize asset portfolios and streamline development process. The low oil price environment will also change the upstream development priorities of the E&P companies, by focusing more on projects with shorter production cycle and with less needs for investment capital, and selectively pursuing large projects only when they conform with long-term growth areas and strategies of the companies. On the other hand, aggravated financial conditions of the oil producing countries caused by the low oil prices are expected to bring positive changes for E&P industries in some region, by resulting in improved terms for development and opening of restricted upstream areas to foreign companies.
In the case of oil refining, the total refining capacity will increase due to the gradual increase in world petroleum product demands, but the situations will differ by region. In the Asia-Pacific region, refining facilities will be expanded mainly in China and India, which will lead to intensified competition among Korea, Singapore and Taiwan that have export-oriented refining industries. That is, even though the petroleum product markets in the Asia-Pacific region have great potentials to grow, competition in the market will be intensified and there will be higher policy risks in term of price, supply, and trades of petroleum products for each country involved.
Changes in the international petrochemical industry can be summarized as diversification of raw materials, increased share of high value-added products, and growth of new oil products producing countries. China, the largest importer of petrochemical products, has significantly reduced its imports and is expected to turn itself into a net exporter of petrochemical products in the near term. In addition, countries in the Middle East and India, which are emerging as new export countries in the global petrochemical market, have strengths in producing and exporting general-purpose petroleum products. The increase in production in China, India and the Middle East is considered as a factor to change the trade structure of international petrochemical products.
The direction of growth strategies for Korea's oil and petrochemical sectors should take into account these changes in the international oil market paradigm, especially since they are highly export-dependent.
First of all, in order to maintain competitiveness in core businesses, oil companies in Korea must secure comparative advantage and price competitiveness in the refining facilities, upgrading ratio, and facility utilization ratio. In order to secure the price competitiveness of petroleum products, it is necessary to maintain the utilization rate of refining facilities at a high level. To this end, stable demands for petroleum products need to be secured. Since the Korean domestic market for petroleum products is entering a maturing phase, it is difficult to expect high demand growth in the future. Therefore, oil companies in Korea should exert efforts to secure demand in overseas markets. However, it is difficult to secure stable supply of petroleum products through simple export of petroleum products as being done at the present. It is necessary to establish mid- and long-term demand securing measures such as entry into downstream distribution markets of petroleum products importing countries in the Asia-Pacific region.
To reduce dependence on refining sector for the sales and profits of the Korean oil industry, diversification of the business portfolio should be pursued within the oil industry value chain. Strengthening of petrochemical business sector can create some synergy in that this sector utilize the petroleum products produced by the refining facilities of the same company. The composition of the production portfolio should be contrived to increase the share of products with high profit margins as well as general-purpose products.
Another way to diversify the business portfolio and strengthen the stability of the oil industry is to establish vertically integrated structure by investing in the upstream sector of resource development. However, considering that the oil refining industry in Korea is unlikely to be able to foster core competencies for resource development in the near future, expanding investments in the upstream sector may have insurmountable associated risks with the increased exposure to uncertainty and instability of the crude oil market. Therefore, investment in the upstream sector by an oil refining company should be pursued selectively based on careful consideration of profitability and potential for synergy with other businesses along with the company��s long-term growth vision.
The directions of development for the petrochemical industry presented in this study can be summarized as the following three factors: adjustment of production scale by product, diversification of products and raw material portfolios, and securing new export markets.
The adjustment of production scale by petrochemical product should be focused on general-purpose products, which are difficult to achieve economies of scale, and on the products that are highly dependent on exports to China and yet exhibiting a sharp decline in export volume in recent years. Adjustment of production scale needs to be done autonomously by M&As among companies and reduction of production facilities. The government-led adjustment of production scale is likely to impede rational improvement of industrial structure. The government should pursue a policy of providing information to companies and encouraging autonomous production scale adjustment through analysis on the petrochemical product market outlook and future risk.
Diversification of raw materials used in petrochemical production should be promoted in two directions. Domestically, conversion to LPG and condensate from natural gas should be pursued, and for overseas production, implementation of a strategy to build natural gas production facilities in countries with natural gas reserves is recommended. From the aspect of product portfolio for the petrochemical industry, it is necessary to increase the proportion of value-added products for long-term profitability enhancement, and the government should focus on policy support to encourage companies to invest in R&D in this direction. To enhance the effectiveness of the government-sponsored industry-academia- governmental technology development projects, further efforts must be made to discern areas for government support and to improve objectivity and transparency in the performance evaluation process.
Securing new export markets for the petrochemical industry is necessary for the long-term survival of the industry. But it is not an easy task as the strategy entails elaborate efforts and solid cooperation of various economic players. Pioneering new export markets is a field that industry and government should jointly work together. The industry should continuously pursue business activities to secure international competitiveness and develop new markets through technological progress, and the government needs to collect and provide information for new market development, and to improve export environment for the products through such measures as expanding free trade agreements. |
