The analysis of the current oil prices indicates that from January, 4 to February, 19 of 2016 the world price of, for example, Brent oil has exceeded 30 US dollars per barrel and varied from 30 to 38 USD. In the period of 15 - 21 January, the price was lower than 30 USD and shown minimal value of 27,88 USD since 2004. In general, the average Brent oil price amounted to 32,41 US dollars per barrel. Price dynamics is represented in the table 1.
Current situation with the world oil price is absolutely unacceptable due to its non-allowance to form the debt-neutral budget of manufacturing countries. This budget plays a key role in economic development and performance of social obligations. Oil industry in general is also under the negative influence of the situation. For example, the 2016 budget of Russia was calculated with 3% deficit of the GDP at expected year-average oil price of 50 US dollars per barrel. Moreover, today the prices of 20, 30, 40 USD are taken into account. Kazakhstan has set 40, Azerbaijan – 50, Angola – 48 and Nigeria - 38 US dollars per barrel.
Traditional oil extraction in the North America barely holds an acceptable level, but reduction of drilling rigs for shale gas extraction indicates crises in this sector. 95% of Venezuela budget depends on oil earnings. Oil barrel should cost not less than 77 US dollars to ensure profitability of Mexico’s energy projects. Bolivia, Columbia, Ecuador, Trinidad and Tobago also fully feel the drop in raw material and energy prices. For the lossless budget of Saudi Arabia, oil must cost 98,3 US dollar per barrel; for Oman and Bahrein the price is 96,8 and 89,8 USD respectively.
Today many analysts agree that realistic oil price have to be not less than 50 US dollars per barrel. At the same time, the experts in the oil sector speak about 60-80 USD. No prize for guessing that high oil production and superfluous market offer against decrease in consumption apply strong pressure to the world oil price. In order not to give up the competition, major oil market players do not reduce production and sales volumes, but on the contrary, constantly increasing them. This lock-up situation continues for more than a year and has led to the world oil price started to break through the threshold of 30 US dollars per barrel.
In the current conditions, changes in oil prices will depend on ability of major market players (Russia and the OPEC members are among them) come to an agreement. Today countries negotiate not about reduction in oil extraction, but about “freezing” the extraction on achieved volumes. In the current February, Russia, Saudi Arabia, Qatar and Venezuela agreed to fix volumes on the level of January 2016 after other countries’ support.
Currently, Kuwait, Iraq, Iran and Nigeria have endorsed the agreement on keeping the extraction on the level of January 2016. As is noted in the OPEC, European Union, Russia and China are engaged in dialogue, as well as Mexico and Norway are engaged in negotiations. The USA was also invited for negotiations concerning freezing of the oil extraction level. According to the experts, these measures may adjust the world oil prices.
13 countries are included in the OPEC: Algeria, Angola, Venezuela, Indonesia, Iraq, Iran, Qatar, Kuwait, Libya, Nigeria, United Arab Emirates, Saudi Arabia, and Ecuador.
Each enterprise undertaking an economic activity keeps scores with suppliers and buyers, customers and contractors, tax authorities, shareholders, banks, employees, sundry debtors.
Accounts receivable are thought of as indebtedness owed by enterprises, employees, natural persons to the company. It is disclosed in the balance sheet.
Accounts receivable are considered by law to be in the inextricable connection with the notion “liability”. According to clause 1 article 307 of the Civil Code of the Russian Federation “one entity (debtor) is liable to perform a certain act by liability to the advantage of another entity (creditor), such as: to dispose property, execute a piece of work, render a service, contribute to joint activity, pay money etc. or to refrain from performing a certain activity, however the creditor has a right to call on a debtor for discharge of duty”.
Some analysts take accounts receivable as a credit product. They consider disposal of property or monetary assets as investments in client which as a result lead to profit-making. Under such kind of investment activities the business should be secured by measures on management or mitigation of risk of monetary assets non-repayment.
Dealing with accounts receivable may be carried out in several stages. Sequence, methods and content of work on negotiation of accounts receivable differ on each stage and will depend on existing situation as well as the priority of encountered tasks solution.
1 stage. Basic dealings with the counteragent as a future partner. Conclusion of a contract.
On this stage it is necessary to collect the data about the counteragent, including query of duplicate documents specified by statutory and regulatory enactments; to examine them; to inspect the counteragent for legality of operation, compatibility of practical activities with declared types of activities under registration, financial solvency, ability to meet the contract obligations, to overcome insignificant monetary difficulties. It is essential to draw up a contract wisely, covering the motivation of client for timely repayment of money, possibility of delay in payment upon written approval, punitive sanctions for untimely payment for products, works and services, penalty for use of another’s monetary assets. It is also a good practice to determine the warranty liabilities and to insure the risk of non-payment by counteragent if required.
2 stage. Control for fulfilment of contract terms. Operative administration of accounts receivable.
To keep track of payment terms and to remind the counteragent about the payment dates if required; to control the availability and accuracy of basic documents execution; to charge penalties and fines for delay in payments timely; to keep track of the current counteragent’s solvency, evidences of financial situation worsening and pre-bankruptcy introduction. To classify the client by the extent of risk if required; to coordinate and to sign an additional agreement on delay of payment or on commercial credit, having determine the credit limit, to make other arrangements for purposes of control.
3 stage. Working with counteragent having a past-due debt.
To suspend supply of products, execution of works and services. To find out the causes of accounts receivable delay. If the fact is a delay, to make sure of the availability of documentary evidence; to get the reliable data on financial ability of counteragent-debtor; to conduct negotiations on repayment of the past-due debt, to shape a plan on cancellation of debt or to carry out debt restructuring or remission of certain debt part. To decide whether to work or not with the counteragent-debtor, following the results of debt repayment.
4 stage. Repayment of debt through court action.
On the ground of continuous problems with debt repayment to come to a decision on the following steps: to file a claim in court stating relevant requirements or to bring a court action for adjudication of bankruptcy of the counteragent-debtor; to call upon an occurrence of an insured event; to assign a claim (cession); to transfer a debt on a solvent debtor; to pass a task of debt repayment on outsourcing.
Information and analytical system Globas-i is a reliable assistant throughout all the stages of working with accounts receivable. It helps to inspect the counteragents, to monitor clients and partners, to track the trends of solvency worsening and introduction of pre-bankruptcy evidences, to investigate arbitral process of going through the bankruptcy procedure, to control the current situation on termination of enforcement proceedings.