World Bulletin / News Desk
International credit company Fitch has claimed that if US-Iranian talks lead to the reduction of sanctions on Iran, this will pave the way for EMEA firms to decrease gas and petrol prices in 2014.
In the event of the lifting of sanctions, Fitch has claimed that Iranian petrol could increase the worldwide daily production of petrol by 800,000 barrels.
Fitch has predicted a fall in gas and petrol production costs, a 6.8% reduction in the value of Brent petrol, a decrease in the capital expenses of a total of 7 western European countries and a 5.9% drop in the prices of integration firms in 2014.
This report suggests that in 2014, European expenditure on gas and petrol would descrease by $7.2 billion and bring changes to the general credit rating of the global energy sector.
It said it expected industry operating costs for equipment, facilities, materials and personnel -both skilled and unskilled -, among others, will continue the upward trend started in 2010 as demand for these products and services remains stable.
"However, the rate of change could be lower than in 2013 due to our expectation of a slightly lower hydrocarbon price environment and a follow-on slowdown in exploration and development spending," it added.
A lower hydrocarbon price environment also affects Fitch's capital expenditure forecasts.
"Our current oil and gas corporate price deck shows a decline in the Brent oil price of 6.8% in 2014 and a decrease in the aggregate capex of the seven western European upstream and integrated companies we rate of 5.9 % in the same period. This is roughly equal to a $7.2 billion reduction in capex for the European oil and gas sector in 2014," it said.
The report also noted that any changes to the credit ratings of major European oil and gas companies in 2014 would be driven by company-specific actions related to their individual business and financial profiles.
"We do not expect that changes in credit quality will come from events transpiring in the international energy sector as a whole," it said.