Strategy Guidelines For The Croatian Petroleum Industry Based On Geopolitical Risk Assessment
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Over the last 50 years 79 oil and gas fields were discovered in Croatia with more than 460 million m3 of oil equivalent (OE), which sets the petroleum industry as a very important part of the Croatian economy. Proven oil and gas reserves were estimated to be 198 million m3 OE. In the same period Croatia produced more than 155 million m3 OE. Today there are 43 oil and 13 gas fields. Until the 1970s domestic oil production was sufficient for satisfying the entire Croatian demand for liquid fuels. The fact that current domestic production meets only 20% of oil and around 50% of natural gas demand, implies the necessity for acceptable strategy implementation that will perceive domestic market demands along with global market conditions. Since one company represents the largest part of the Croatian petroleum industry, the basic problem represents compliance of small and medium petroleum companies to heavy business conditions in the global market. This is a consequence of petroleum companies’ high sensibility to geopolitical risks. Therefore, the precise evaluation of geopolitical risks in time and the assessment of the impact of the creation of a company business strategy could be crucial for the entire Croatian petroleum industry. The Croatian petroleum industry expressly needs business expansion in the markets of neighbouring countries and recovering oil and natural gas reserves from areas with a higher potential in reserves exploration but also with higher political instabilities. Also, it is pressurized by the necessity of business rationalization and the improvement of profitability. Therefore, geopolitical risk assessment is of great importance for the creation of strategic guidelines that should show a way of meeting domestic hydrocarbon consumption along with achieving a desirable business position especially in the regional market. Keywords: Croatian petroleum industry, strategic planning, risks assessment, geopolitical risk.
Croatian petroleum industry, strategic planning, risks assessment, geopolitical risk.