DATED BRENT & THE OIL SURPLUS

Private & Confidential 1

-3

-2,5

-2

-1,5

-1

-0,5

0

0,5

1

1,5

0

20

40

60

80

100

120

140

Dated Brent ($/b, left axis) Quarterly implied change in global stocks (million barrels/day, right axis)

CRUDE OIL PRODUCTION – THE BIG THREE

Source: IEA

(Million b/d) TOTAL CRUDE OUTPUT

5

6

7

8

9

10

11

US Russia Saudi Arabia

(Million barrels) TOTAL OECD OIL STOCKS

2500

2600

2700

2800

2900

3000

3100

-4

-3

-2

-1

0

1

2

Urals CIF Augusta Urals CIF Rotterdam

URALS SUPPLY/DEMAND HITS NEW

BALANCE

Volatility Drops

Source: Platts

URALS DIFFERENTIALS VERSUS DATED BRENT

($/ B)

CRUDE FLOWS TO EUROPE: RUSSIA & THE

CIS Varandey (Russia)

Urals Primorsk (Russia)

Urals Ust-Luga (Russia)

Urals Novorossiisk (Russia)

CPC Blend (Kazakhstan)

Azeri Light (Azerbaijan)

• Urals exports increasingly concentrated out of Baltic Sea, with Black Sea exports in decline.

• Urals from the Baltic Sea is 2nd largest crude source in Northwest Europe, but Urals from Black Sea has become largely a Black Sea-only crude grade.

• CPC Blend has surpassed Urals as single largest crude stream out of the Black Sea.

• Azeri Light exports are increasingly sent to Far East amid weaker regional demand.

Siberian Light (Russia)

URALS EXPORTS TO EUROPE (B/D)

Source: Platts

0

500 000

1 000 000

1 500 000

2 000 000

2 500 000

3 000 000

Primorsk Ust-Luga Novorossiysk

THE GROWTH IN CPC BLEND EXPORTS

(B/D)

Source: Platts

0

200 000

400 000

600 000

800 000

1 000 000

1 200 000

CPC Blend Exports (B/D)

STRONG MARGINS SUPPORT HIGH

THROUGHPUT

9 500

10 000

10 500

11 000

11 500

12 000

12 500

13 000

OECD EUROPE REFINING THROUGHPUT

(kb/d)

Source: IEA

79%

92%

68%

78% 77% 75%

84%

95%

77%

83% 85% 84%

0%

20%

40%

60%

80%

100%

1 2 3 4 5 6

2014

2015

UTILIZATION RATES BY COUNTRY: 2014 vs.

2015*

*Through November 2015

-10

-5

0

5

10

15

20

Urals Basrah LightCPC Blend Azeri LightArab Medium Saharan Blend

-5

0

5

10

15

20

Forties UralsEkofisk Arab MediumBasrah Light Brass River

MARGINS SLIDING FROM LONG-TERM

HIGHS CRACK MARGINS – NWE ($/B)

Post-2009 peak

CRACK MARGINS – MED ($/B)

Source: Platts, Turner & Mason

Post-2009 peak

MARGINS SLIDING FROM LONG-TERM

HIGHS

Source: Platts

-4

-2

0

2

4

6

8

10

12

$/b

arr

el

Forties ARA Cracking Netback Margin Oman Singapore Cracking Netback Margin

RELATIVE STRENGTH IN GASOLINE

RETURNS

Source: Platts

0

5

10

15

20

25

30

авг-2012 янв-2013 июн-2013 ноя-2013 апр-2014 сен-2014 фев-2015 июл-2015 дек-2015 май-2016

$/b

arr

el

Diesel Gasoline Jet

STRONG GROWTH IN US GASOLINE

COMSUMPTION

7,6

7,8

8

8,2

8,4

8,6

8,8

9

9,2

9,4

9,6

mil

lio

n b

/d

2013 2015

Source: EIA

CONSUMERS SIMPLY DRIVING MORE

180

190

200

210

220

230

240

billio

n m

iles

Source: EIA

Total mileage in US

0

5

10

15

20

25

Month 1 Month 2

EUROPEAN EBOB CRACKS ($/B)

Jul 31, 2015: $22.95/b; highest since at least 2010

GASOLINE STOCKS ON THE RISE

150

170

190

210

230

250

270

Current Stocks 5 year average

Up 11.5%

US GASOLINE STOCKS (MIL OF

BARRELS)

Source: EIA, Platts

DISTILLATE CRACKS SLIDE AS STOCKS

RISE

450

470

490

510

530

550

570

590

610

OECD EUROPE DIST STOCKS (MIL OF

BARRELS) 600 million barrels: highest since Jan 2011

Source: IEA, Platts

0

2

4

6

8

10

12

14

16

18

Jet Cargo Mo 1 Diesel10ppm Cargo Mo 1

Gasoil 0.1% Cargo Mo 1

EUROPEAN DISTILLATE CRACKS ($/B)

EXPLAINING WEAKNESS IN DIESEL…….

0

1000

2000

3000

4000

5000

6000

7000M

ar2

01

0

Ma

y2

010

Jul2

01

0

Sep2

010

No

v2

010

Jan2

011

Ma

r201

1

Ma

y2

011

Jul2

01

1

Sep2

011

No

v2

011

Jan2

012

Ma

r201

2

Ma

y2

012

Jul2

01

2

Sep2

012

No

v2

012

Jan2

013

Ma

r201

3

Ma

y2

013

Jul2

01

3

Sep2

013

No

v2

013

Jan2

014

Ma

r201

4

Ma

y2

014

Jul2

01

4

Sep2

014

No

v2

014

Jan2

015

Ma

r201

5

Ma

y2

015

Jul2

01

5

Sep2

015

No

v2

015

Jan2

016

Ma

r201

6

000's

to

nn

es

Russia USA Saudi Arabia

Source: CCFA

US EXPORTS OF DISTILLATES

0

200

400

600

800

1000

1200

1400

1600

янв-2009 янв-2010 янв-2011 янв-2012 янв-2013 янв-2014 янв-2015 янв-2016

000's

b/d

0-15 ppm 15-500 ppm 500 ppm +

Source: EIA

MIDDLE EAST REFINERY EXPANSIONS

Yanbu

Jazan

Rabigh

Duqm

Sohar

Fujairah Ras Laffan

11

Ras Tanura

Jubail

Al Zour

Ruwais 1

2

3

4

5

6 7

11

8

9

10

Refinery

Yanbu

Rabigh

Jazan

Al Zour

Jubail

Ras Tanura

Ras Laffan

Fujairah

Sohar

Duqm

Ruwais

Aramco/Sinopec

Aramco/Sinopec

QP/Total

Aramco

KNPC

Aramco/Total

Aramco

IPIC

QRPIC

IPIC/OOC

ADNOC

400 kb/d

Upgraded (Phase 2)

+146 kb/d

400 kb/d

615 kb/d

400 kb/d

Upgrade

200 kb/d

+86 kb/d

230 kb/d

+417 kb/d

2014

2016

2016

2018

2019

2013

Relaunch

2016

2015

Owner Capacity/

Expansion Completion

1

2

3

4

5

6

7

8

9

10

11

Source: Platts

MIDDLE EAST REFINERY EXPANSIONS

Yanbu

Jazan

Rabigh

Duqm

Sohar

Fujairah Ras Laffan

11

Ras Tanura

Jubail

Al Zour

Ruwais 1

2

3

4

5

6 7

11

8

9

10

Refinery

Yanbu

Rabigh

Jazan

Al Zour

Jubail

Ras Tanura

Ras Laffan

Fujairah

Sohar

Duqm

Ruwais

Aramco/Sinopec

Aramco/Sinopec

QP/Total

Aramco

KNPC

Aramco/Total

Aramco

IPIC

QRPIC

IPIC/OOC

ADNOC

400 kb/d

Upgraded (Phase 2)

+146 kb/d

400 kb/d

615 kb/d

400kdb

Upgrade

200 kb/d

+86 kb/d

230 kb/d

+417kbd

2014

2016

2016

2018

2019

2013

Relaunch

2016

2015

Owner Capacity/

Expansion Completion

1

2

3

4

5

6

7

8

9

10

11

Source: Platts

RUSSIAN REFINERY MODERNIZATION

Kuybyshev (Rosneft)

Novokuybyshev (Rosneft)

Syzran (Rosneft) Angarsk (Rosneft)

Achinsk (Rosneft)

Komsomolsk (Rosneft)

Tuapse (Rosneft)

Ryazan (Rosneft) Moscow (Gazpromneft)

Perm (Lukoil)

Nizhny Novgorod (Lukoil)

Volgograd (Lukoil)

Omsk (Gazpromneft)

Salavat (Gazprom)

Yaroslavl (Slavneft) Kirishi (Surgutneftegaz)

Ufa (Bashneft)

RUSSIAN REFINERY MODERNIZATION

Kuybyshev (Rosneft)

Novokuybyshev (Rosneft)

Syzran (Rosneft) Angarsk (Rosneft)

Achinsk (Rosneft)

Komsomolsk (Rosneft)

Tuapse (Rosneft)

Ryazan (Rosneft) Moscow (Gazpromneft)

Perm (Lukoil)

Nizhny Novgorod (Lukoil)

Volgograd (Lukoil)

Omsk (Gazpromneft)

Salavat (Gazprom)

Yaroslavl (Slavneft) Kirishi (Surgutneftegaz)

Ufa (Bashneft)

5

1 2 3

4

6 7 8

9

10 11

12

13 14

RUSSIAN PRODUCT EXPORT FOCUS ON

EUROPE Refinery

Kirishi

Yaroslavl

Moscow

Rayazan

Kuybyshev

Syzran

Novokuybyshev

Ufa

Salavat

Volgograd

Tuapse

Owner Completion

1

2

3

4

5

6

7

8

9

10

11

Units/Capacity

Surgutneftegaz

Omsk

Perm

12

13 Nizhny Novgorod 14

Slavneft

Gazpromneft

Rosneft

Rosneft

Rosneft

Rosneft

Bashneft

Gazprom

Rosneft

Lukoil

Lukoil

Lukoil

Gazpromneft

Reformer (1 mil mt/yr); FCC (1.25 mil mt/yr); Isomerization (280,000

mt/yr) Reformer: 2015; FCC: 2016; Isomerization:

2014

Reformer (1.2 mil mt/yr); Hydrocracker (2 mil mt/yr); Diesel

desulfurization (2.75 mil mt/yr) Isomerization (280,000 mt/yr) Reformer: 2015; Hydrocracker: 2018;

Hydrodesulfurization: 2018; Isomerization: 2015

Reformer (1.5 mil mt/yr); Hydrocracker 4mil mt/yr); Diesel

desulfurization (4.3 mil mt/yr) Isomerization (800,000 mt/yr) Delayed until 2019

Planned for 2020 Hydrocracker (2.2 mil mt/yr)

Second FCC (2 mil mt/yr); Alkylation (367,000 mt/yr) Launched 2015

Diesel desulfurization (1.5 mil mt/yr); Coker (2.1 mil mt/yr) Launched 2015

Hydrocracker (3.5 mil mt/yr); CDU (6 mil mt/yr) CDU: 2015; Hydrocracker: 2016

FCC (2.3 mil mt/yr); CDU (5 mil mt/yr); Hydrocracker (2.08 mil mt/yr) FCC: 2016; CDU: 2015; Hydrocracker: 2017

FCC (2 mil mt/yr); CDU (6 mil mt/yr); Diesel Hydrotreater (2 mil

mt/yr); Reformer (1 mil mt/yr) FCC: 2016; CDU: 2017; Diesel

Hydrotreater: 2017; Reformer: 2017

FCC: 2016; Isomerization: 2015 FCC (1 mil mt/yr); Isomerization (434,000 mil mt/yr)

Hydrocracker (2 mil mt/yr) Delayed until 2022

Planned for 2018 Isomerization (1.1 mil mt/yr)

FCC (1.25 mil mt/yr); Diesel Desulfurization (2.5 mil mt/yr) Delayed until 2016, 2018

Coker (2.2 mil mt/yr) Planned for 2019

RUSSIAN PRODUCT EXPORT FOCUS ON

EUROPE Refinery

Kirishi

Yaroslavl

Moscow

Rayazan

Kuybyshev

Syzran

Novokuybyshev

Ufa

Salavat

Volgograd

Tuapse

Owner Completion

1

2

3

4

5

6

7

8

9

10

11

Units/Capacity

Surgutneftegaz

Omsk

Perm

12

13 Nizhny Novgorod 14

Slavneft

Gazpromneft

Rosneft

Rosneft

Rosneft

Rosneft

Bashneft

Gazprom

Lukoil

Rosneft

Lukoil

Lukoil

Gazpromneft

Reformer (1 mil mt/yr); FCC (1.25 mil mt/yr); Isomeration (280,000

mt/yr) Reformer: 2015; FCC: 2016; Isomeration:

2014

Reformer (1.2 mil mt/yr); Hydrocracker (2 mil mt/yr); Diesel

desulfurization (2.75 mil mt/yr) Isomeration (280,000 mt/yr) Reformer: 2015; Hydrocracker: 2018;

Hydrodesulfurization: 2018; Isomeration: 2015

Reformer (1.5 mil mt/yr); Hydrocracker 4mil mt/yr); Diesel

desulfurization (4.3 mil mt/yr) Isomeration (800,000 mt/yr) Delayed until 2019

Planned for 2020 Hydrocracker (2.2 mil mt/yr)

Second FCC (2 mil mt/yr); Alkylation (367,000 mt/yr) Launched 2015

Diesel desulfurization (1.5 mil mt/yr); Coker (2.1 mil mt/yr) Launched 2015

Hydrocracker (3.5 mil mt/yr); CDU (6 mil mt/yr) CDU: 2015; Hydrocracker: 2016

FCC (2.3 mil mt/yr); CDU (5 mil mt/yr); Hydrocracker (2.08 mil mt/yr) FCC: 2016; CDU: 2015; Hydrocracker: 2017

FCC (2 mil mt/yr); CDU (6 mil mt/yr); Diesel Hydrotreater (2 mil

mt/yr); Reformer (1 mil mt/yr) FCC: 2016; CDU: 2017; Diesel

Hydrotreater: 2017; Reformer: 2017

FCC: 2016; Isomerization: 2015 FCC (1 mil mt/yr); Isomerization (434,000 mil mt/yr)

Hydrocracker (2 mil mt/yr) Delayed until 2022

Planned for 2018 Isomerization (1.1 mil mt/yr)

FCC (1.25 mil mt/yr); Diesel Desulfurization (2.5 mil mt/yr) Delayed until 2016, 2018

Coker (2.2 mil mt/yr) Planned for 2019

FUEL OIL CRACKS STRENGTHEN

-25

-20

-15

-10

-5

0

янв.13 июл.13 янв.14 июл.14 янв.15 июл.15 янв.16 июл.16

DECLINING RUSSIAN EXPORTS

0

0,5

1

1,5

2

2,5

3

3,5

4

4,5

5

July 2014 July 2015 July 2016

DECLINING RUSSIAN FO EXPORTS

0

0,2

0,4

0,6

0,8

1

1,2

1,4

1,6

1,8

2

Rosneft Lukoil Surgut Slavneft GazpromNeft

Afipsky Bashneft TAIF-NK Taneko Orsk

Millio

n t

on

nes

Jul-14

Jul-15

Jul-16

QUESTIONS &

ANSWERS