OREANDA-NEWS. February 22, 2012. “Price forecast for oil products is stable”, said the Head of the Federal Antimonopoly Service (FAS Russia), Igor Artemyev at the annual extended FAS Collegium, reported the press-centre of FAS Russia.

In this connection FAS would like to state that the Government on the Russian Federation discusses the situation on the market of oil products at a regular basis. Such meetings involve the Ministry of Energy and other interested authorities and organizations, including oil companies. The agenda includes assessment of a current satiation, taxation, support to agriculture, modernization of oil treatment, etc. In particular, the parties gave estimates of the trends on the market of oil products. All participants, including the Ministry of Energy and oil companies have similar positions – there are no grounds for unreasonable growth of prices for oil products.

From time to time the media raise a question of “freezing” prices, right when there are preconditions for reducing fuel prices. Typically it happens at the end of December and in January – February, when there are all preconditions for reducing (rather than “freezing”) fuel prices. The difference at the beginning of 2012 is that there is overlapping of a general tendency of seasonal price reduction and a tendency for growing prices due to increase of excise taxes. Additional factors towards decreasing prices on domestic market at the beginning of 2012, unlike the beginning of 2011, are: overall, stable situation on international markets with moderate price volatility, and accumulating sufficient reserves of winter diesel fuel and gasoline. Observing the antimonopoly law by oil companies is another important factor.

Oil companies understand that in case of violating the antimonopoly law severe sanctions will be applied. Earlier FAS fined three oil companies over three billion Rubles for fixing monopolistically high prices at the end of 2010 – beginning of 2011. Increase of excise taxes was a pretext, but not a reason for increasing prices. Similar situations developed in Q2 and Q3 2011 on the gasoline market. Once again, based on the case outcome FAS imposed a fine upon an oil company, and is considering imposing a fine upon another company. As a result of cases investigation, prices went down. Efforts of the Ministry of Energy for control over refinery outage, maintaining the required fuel reserves, etc., contribute to stabilizing the situation on the market.

A downward trend has developed since the beginning of 2012 for ex-works refinery prices (to a greater degree) as well as price quotation in small wholesale segment and retail prices (to a lesser degree). According to “KORTES” Information Centre, in the first week of February and since the beginning of 2012 ex-works refinery prices have reduced for АI-92 – by 2% and 5.6%, for АI-95 – by 0.7% and 3.9%, for summer diesel fuel – 0.5% and 0.5%, for winter diesel fuel – 0.8% and 4.5%. In the same periods, prices on the small wholesale market were reduced: for АI-92 -1.4% and 3.7%, for АI-95 – 1% and 3%, for summer diesel fuel – 1.3% and 1.9%, for winter diesel fuel – 0.4% and 1%.

According to Rosstat [the Federal State Statistics Service], the consumer price index for goods and services in January 2012 was 100.5% in comparison with the previous month. Gasoline prices decreased in 27 centres of the constituent territory of the Russian Federation. In 51 centres of the constituent territory of the Russian Federation; gasoline prices remained at the level of the previous week. FAS monitoring confirms data of information-and-analytical agencies and government statistics regarding price behaviour on the gasoline market.

Overall, the situation on the market is rather stable. Exchange quotation prices, off-exchange spot prices and NetBack prices do not differ significantly. In comparison with the first half of 2011, at the end of 2011 the earning yield in general became more balanced on the large wholesale – small wholesale – retail chain. FAS Russia continues monitoring prices, circulation and remaining fuel on petroleum storage depots. With adopting a draft law on market pricing, devised by FAS Russia, these indicators will be available to all market participants, which will make situation on the market fully foreseeable and transparent.