We tend to think of the fall of governments as the collapse of many things, the end of certain eras in that country’s history, and that may certainly be true in many cases, however, in some cases it can also be the beginning of many things, chief among them being opportunity.
Rosneft was established as a result of the collapse of the former U.S.S.R and its ministry of Oil and Gas, but as we said early on, from that particular collapse came many good things, and the same could be said of any future investment in Rosneft binary options.
At the time of its establishment Rosneft had ownership over a very small number of assets, most of which were in poor shape both from a physical standpoint, as well as from a managerial standpoint, resulting in a very low yield of profits, despite locations which were considered as having great production potential.
Years of mismanagement and corruption under government control, and power struggles after the formation of the new company resulted in severe losses in the company’s early years.
Despite early losses, the company began modernizing its decade’s old equipment and slowly increased productivity and profitability; further investments came in the form of development of new projects near the Caspian Sea in 2003, in 2004 the company entered merger talks with Gazprom, but those talks fell through and did not yield any great gains for Rosneft.
During 2004 Rosneft ended up winning a series of government auctions for assets previously owned by Yukos, which was broken up when accused of tax fraud and evasion, the purchase put Rosneft at substantial risk due to the increase in the company’s debt, but expansion plans into China and continued modernization helped increase output, causing a rise in prices instead.
In the years that followed, Rosneft has continued its expansion by investing heavily in developing new sites and exploring deposits in various locations, some of them as part of a series of partnerships with other large Oil companies, from BP to ExxonMobil increasing both its future production potential as well as its capital and shared interests in markets outside the Russian one, opening up new and previously unexplored profit opportunities for the company, this was followed up with the purchase of Russia’s 3rd largest Oil company, increasing the control Rosneft holds over the Russian energy market.
At present, BP holds nearly 20% of Rosneft’s stock, while the Russian government holds roughly 70%, the remaining 10% is available for purchase by the public.
Rosneft’s profits in 2013 exceeded $100 billion with a net income of over $10 billion, and the company now employs over 100,000 people, mostly in Russia, but in other parts of the world as part of strategic partnerships, research and expansion efforts.
As with most companies that are in the commodity business, you should always be on the lookout for new discoveries, successful development of existing ones, and the rise and fall of the global energy markets, all of which can serve you greatly when attempting to predict the next move that Rosneft binary options will take and position yourself accordingly.