Influence of Working Capital Management on Profitability of Oil & Gas Exploration Sector in Pakistan
ABDUL SAMAD MUNAF
First of all we would like to thank Allah Almighty for granting us the capability and courage to work on this report with my best efforts, and for the patience and perseverance endowed by Him. We would also like to thank Mr. H. JAMAL ZUBAIRI for giving us the chance to work on this report and for his guidance, advice and examples during regular sessions which made this report possible. We would also like to extend our gratitude to the senior students who gave guidance and helped us in this report. We genuinely hope that this report meets the designated standards and you have a pleasant time going through it. Thank you.
The oil and gas exploration sector has vital impact on the economy of the country. The report analyses the global scenario of the oil and gas sector and how the reserves around the world of oil and gas are increasing because of the extreme importance given to the sector of oil and gas exploration. Moreover, the consumption of oil and gas has declined last year because of various reasons including alternate energy uses like nuclear energy. When considering the scenario in Pakistan, the consumption is increasing which is against the global trend. Moreover, industries pose heavy demands on the oil and gas sector. Literature is analyzed and review provides with the understanding of the literature in few words. The impact of different ratios on profitability are analyzed through the use of ratios and different statistical tools. The conclusion clearly indicates that cash conversion cycle only has the significant impact on the profitability.
Oil and gas has been considered as one of the most used resources in producing energy. And energy, which has been one of the most important factors in the success of the country, if managed in an efficient and effective measure can prove to be the real asset of the country. More energy means more industrialization and industrialization is considered as the backbone of a successful economy. When taking a global stance towards oil and gas sector, one has to consider the demands of the global economy and how the reserves are used to meet the demands. Now, what we have noticed is extreme growth in world population. Since 1962, population has almost doubled in 2005. Moreover, from and 2005 to now, the pace of population growth suggest that up till 1950, the population would cross 9.2 billion. This increasing population and simultaneously increasing standard of living, industrialization and energy demands pose heavy demands on the oil and sector of the globe. Oil, which accounts for 34% to 37% of the total energy, has vital demands. Professionals have predicted that oil and gas reserves would deplete and climate may also show some huge threats to the sector. However, the increasing pressure can take other way to as people have now more technology and expertise to use the resources efficiently and use other resources for the generation of energy like solar, nuclear etc. Following can be named as vital events witnessed by the global oil sector: Nationalization of the Iranian oil industry in 1951
Formation of OPEC in 1959
Nationalization of the Iraqi oil industry in 1972
First oil price shock caused by Arab boycott of oil supplies to USA because of Arab Israeli war; price rises from US$ 2.50 to US$ 10 per bbl " in 1973 Nationalization of the Kuwaiti oil industry " in 1975
Nationalization of the Saudi Arabian oil industry " in 1979
Second oil price shock cause by fall of the Shah of Iran; price rises from US$ 12 to US$ 30 per bbl " in 1979 Third oil shock caused by Iraqi invasion of Kuwait; price rises from US$ 15 to...
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