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Something hideous takes place with fuel prices in Bulgaria

Photo: BGNES

The Bulgarian society is again strongly indignant with the drastic gap between falling crude oil prices on world markets and the unchangeable liquid fuel prices on the domestic market. The website energy.eu that summarizes fuel information from all countries of the European Union makes clear that diesel fuel in Bulgaria is the most expensive across EU before it is levied with excise and VAT. Meanwhile in eleven EU states because of higher taxes and fees diesel at petrol stations is more expensive than diesel in Bulgaria. With the most common petrol А-95 the situation is similar.

The losers from high retail prices are end-consumers, and from the low excise – the national revenue. No losers are found in the group of producers and distributors. Experts comment that there is no way for low world prices to bypass the Bulgarian market but for the time being this is a fact. Prices fluctuate up and down by 2 to 4 stotinki (1 to 2 eurocents) per liter and this is downright outrageous. So outrageous indeed that even the prime minister did not rule out the existence of a cartel agreement of petrol stations and asked the Commission for the Protection of Competition to carry out the respective inspection. In April 2012 that same commission ruled that there was a cartel agreement between the petrol companies Lukoil Bulgaria, Rompetrol Bulgaria, Naftex Petrol and OMV Bulgaria, but three months later it revised its conclusion. Now the commission has to say whether there is a cartel of petrol stations and average Bulgarians wonder what the chances are of the situation of three years ago to reoccur.

Of course, prices could be cut by fuel exports but experts contend this would be rather risky in the context of the monopoly of the Lukoil refinery in Bulgaria. Earlier this week, Prime Minister Boyko Borissov added fire to the flames of mass resentment by ordering a resealing of the reservoirs of all petrol stations in the country after poor quality sealing so far allowed falsifying both the content and quantities of sold fuel. Turpentine in some fuels reportedly reached up to 40% and during the traditional summer peak of trips sold quantities have declined instead of increasing.

The state is able to intervene for the sake of more balanced prices given there is genuine will for such action, but some analysts fear that the state is trapped in dependence on refineries and distributors. This dependence is particularly strong on the eve of elections that are due this autumn. However, there is also the reverse logic: a positive change will favor at the elections the political player who dares carry it out, because the situation with fuels in Bulgaria has been unsightly for so many years that it has already become unbearable.

 English Daniela Konstantinova


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