In 2024, OMV achieved a strong clean CCS Operating Result of EUR 5.1 bn. Cash flow from operating activities including net working capital effects remained significant, amounting to EUR 5.5 bn, and organic free cash flow totaled EUR 2.0 bn. The leverage ratio was 12%. This financial strength is an excellent basis for OMV’s ongoing strategic transformation into an integrated sustainable chemicals, fuels, and energy company, and its commitment to delivering attractive shareholder returns.
Business Environment
Macroeconomy
Global GDP growth was stable yet underwhelming in 2024 as economies were unable to rebound, keeping growth rates at the weakest levels in recent decades (excluding major recessions). Besides slow growth rates, economies experienced receding inflationary pressure. Consequently, monetary policy rates started following suit, preventing undue increases in real interest rates. IMF projections expected 2024 annual GDP growth to be at 3.2%IMF World Economic Outlook, January 2025 and therefore below the averages from 2023 and 2010–2019 respectively.
The negative supply shocks to the global economy that have occurred since 2020 have had lasting effects on output and inflation, with varied impacts across individual countries and country groups. Developed economies have reached and surpassed pre-pandemic output levels and inflation has been increasing. Meanwhile, emerging economies are showing more permanent scars, with large output shortfalls and persistent inflation. These countries also show higher vulnerability to commodity price surges, for example as experienced following Russia’s invasion of Ukraine.
Growth rates continued to remain uneven, with different factors exerting influence in different regions. The US economy continued to outperform other developed economies on the back of stronger consumption – driven by a rise in real wages, especially among lower income households – and non-residential investments. Euro area economic performance remained subdued in 2024, as elevated commodity prices put pressure on manufacturing output for the past two years. However, the rise in households’ disposable income supported private consumption, limited only by precautionary savings. For the Chinese economy, persisting weakness in the real estate sector and low consumer confidence have remained the key headwinds.
Global headline inflation decreased further, from an average of 6.7% in 2023 to 5.7% in 2024. Disinflation was faster in advanced economies – with a decline of 2 percentage points from 2023 to 2024 – than in emerging markets and developing economies, in which inflation declined from 8.1% in 2023 to 7.8% in 2024. Disinflation in 2024 reflects a broad-based moderation in prices all over the consumer basket, unlike in 2023, when moderation in headline figures was driven by year-on-year commodity prices – not reflected in core inflationInflation excluding food and energy . The delayed impact of earlier monetary tightening and high base were the key drivers behind moderating core and headline inflations.
As a result of easing inflationary pressures and moderate economic growth, key central banks started easing monetary conditions in Europe and in the US. A new monetary cycle started first in Europe in June 2024 amid weaker macroeconomic fundamentals. The ECB policy rate started the year at 4% and ended 2024 at 3%, following interest rate cuts in four steps: June, September, October, and December. The Bank of England followed suit by cutting interest rates from 5.25% to 4.75% in two steps in July and November. In the US, both growth and inflationary expectations surpassed Europe’s and as a result policy rate moderation started only in September. In January, the key policy rate was in the 5.25–5.5% range, while it ended the year in the 4.25–4.50% band, following rate cuts in three steps: September, October, and December. Unlike the rest of the world, the Bank of Japan increased the policy interest rate for the first time since 2016 from –0.1% to 0.1% in March 2024, and this was repeated at the end of July to 0.25%. The second increase caused a temporary crash on the Japanese financial markets as surging Yen induced selling pressure. Lower interest rates in most parts of the world are expected to impact the economy through monetary transmission mechanisms. Easing credit conditions might lend support to housing markets, investments, and economic activities in general.
Oil
The oil price environment was, on average, fairly close to the level of 2023. Platts Dated Brent averaged USD 81/bbl in 2024, a decline of around 2% compared to the average from the prior year. The trajectory of oil prices was somewhat different in 2024, however, with the level in the first half of the year averaging comfortably above USD 80/bbl but giving way to lower prices from the third quarter onward. This trend was driven by geopolitical risks to oil transportation and oil supply, increasingly giving way to the perception that oil demand growth was slowing. The second half of 2024 saw major forecasting agencies’ demand growth outlooks for both 2024 and 2025 converge at lower levels, with a weaker outlook for Chinese oil demand often cited as a factor. Oil prices also remained higher in local currency terms for a large share of the crude import market even as oil prices in dollar terms trended lower from the third quarter. The perception that demand was not keeping up with supply growth was underpinned by OPEC policy in the second half of 2024. The Group has repeatedly pushed back plans to return barrels to the market in order to avoid new price pressures, in December postponing again to the end of the first quarter of 2025 and on a slower schedule than previously. IEA and EIA estimates put 2024 global oil demand growth at around 1 mn bbl/d year-on-year, a marked slowdown from the 2 mn bbl/d estimated global growth rate year-on-year in 2023.
Crude price (Brent) – monthly average1
In USD/bbl
Natural Gas
European natural gas benchmarks averaged at lower levels in 2024 than in 2023. In the early part of 2024, prices on European hubs fell to the lowest levels since 2021, with TTF briefly dropping below EUR 25/MWh. European natural gas demand remained muted, as per the IEA, though the pace of the declines was markedly slower than was observed in 2022 and 2023, when market prices for gas were significantly higher. The lower prices observed in the early part of 2024 did have some impact. Industrial gas demand in Europe has shown a partial recovery, offsetting some declines in the power generation sector and coming despite the broader difficulties observed in some major energy-intensive European sectors. At the same time, LNG inflows were consistently lower over 2024 as price levels were not sufficient to attract flexible LNG flows to the European market. This picture shifted after the market started to rally from the beginning of the third quarter, as supply uncertainties, combined with the onset of cold weather and more demand from the power sector, drove TTF and THE towards the EUR 50/MWh level as the end of the year approached. This pricing level appeared sufficient to ensure Europe became the premium market again for LNG ahead of Asia, which translated into more arrivals as storage facilities were drawn rapidly at times after the start of the heating season. Total regional natural gas demand trended close to flat in 2024 compared to 2023.
Natural gas price (THE) – monthly average1
In EUR/MWh
Refining margin
The refining margin was around USD 7.1/bbl in 2024, a significant decline compared to USD 11.6/bbl in 2023, following the unprecedented highs after the initial phases of the Russia-Ukraine war and only sluggish consolidation in the refinery sector. Naphtha crack spread recovered to historical trends from extreme lows in 2023, even though macroeconomic headwinds kept pressuring market sentiment. However, from the second half of the year, the market was supported by the narrowing discount of LPG to naphtha, which made the latter a more competitive feedstock for petrochemical producers. The gasoline crack spread eased compared to 2023 highs. Market fundamentals began diverging from 2023 trends at the end of the second quarter, with the crack spread weakening counter-seasonally due to a weaker than expected US driving season, leading to more complicated trans-Atlantic arbitrage from Europe to the US. Additionally, production started ramping up at the Dangote refinery in Nigeria in the second half of the year, leading to lower exports to West Africa and weighing on future expectations. Middle distillate crack spreads benefited the most from the Russia-Ukraine war. However, markets have been reverting to historical trends in recent years. Nevertheless, the diesel crack spread was still around USD 200/t in the first quarter of 2024, double the historical average. Markets substantially weakened in April as the heating season ended and the subdued macroeconomic environment in Europe weighed on demand. Starting in summer, freight rates also fell substantially, which allowed more arbitrage volumes to arrive in Europe from the US and the Middle East, placing additional pressure on the market.
Refining indicator margin Europe (OMV) – monthly average1
In USD/bbl
Chemicals
Even though European base chemicals market conditions improved in 2024 compared to the previous year, the market continued to face challenging conditions. Base chemicals demand exceeded expectations, supported by limited monomer and derivative imports. This led to an increase in cracker operating rates to around 72% in 2024, recovering from 2023’s historically low average of 68%. Planned and unplanned cracker outages, along with permanent closures, helped balance the market’s supply and demand. In the first half of 2024, the dryness of the Panama Canal restricted traffic of key olefin derivatives like PE and PP. Despite easing restrictions later in the year, high freight rates persisted due to geopolitical tensions at the Red Sea. Even with better-than-expected demand, the European market remained weak overall due to the economic slowdown, particularly in the construction industry, which was heavily impacted by interest rate hikes. In polyolefins, the overhang of new capacities in Asia continued to weigh on utilization rates and prices. Asian demand saw some support from the consumer products industry, as well as government stimulus policies. The recovery of the tourism and catering sectors, particularly in China and Southeast Asia, also contributed to demand growth. However, the prolonged real estate challenges, low birth rate in China, and weak finished product demand led to a slower rate of demand growth compared to historical levels. In 2024, the operating rates in Northeast Asia were 80% (2023: 83%) for polyethylene and 77% (2023: 80%) for polypropylene. In Europe, the end use demand remained affected by the macroeconomic slowdown and downturn in several sectors, especially in the infrastructure industry. Significant inflow of finished goods from China further delayed an industrial recovery. The European polyolefin market faced significant import pressure throughout 2024, driven by competitive pricing from external markets and economic challenges within the region, while supply was adequate throughout the year. In 2024, the operating rates in Europe were 77% (2023: 68%) for polyethylene and 80% (2023: 78%) for polypropylene.
Polyolefin margins (OMV) – month-end values1
In EUR/t
