Lukoil to reduce capital expenses and acquisitions

The unstable political and economic situation has forced Lukoil to reduce its costs. In 2015, the company will reduce its investment program by $2 billion, and, according to the Kommersant’s information, isn’t going to spend money on new purchases, keeping money in the company. Lukoil has withdrawn from the deal on purchase of an asset in oil refining, and has got back an advance in the amount of $400 million. Analysts believe that the economy's can be connected with the total rise in cost of borrowed funds.

It’s reasonable for Lukoil to reduce its capital expenses, the vice president of the company, Leonid Fedun reported on Friday. "I will recommend to my colleagues to reduce the investment program to have more cash," - said Mr. Fedun. According to him, in the first six months, Lukoil spent about 50% of the total amount of the investment, but "there is a task to reduce the capital cost by approximately $2 billion," - said Mr. Fedun. Lukoil’s vice president of finance, Alexander Matytsyn noted that this would be a reduction of the investment program in 2015.