TRENDS ON OIL PRODUCTS MARKETS DISCUSSED IN ULAN-UDE

On 31 July 2018, during his visit to Buryatia, Deputy Head of FAS Anatoly Golomolzin chaired a meeting in Ulan-Ude, on oil products sale and development of exchange trade

The event involved all interested parties, including: the exchange for large and small wholesale trade, large vertically-integrated companies of the Siberian Federal District as well as chains of independent fuelling stations in the regions and the Russian Fuel Union.

The attendees discussed the most pressing current issues and objectives for selling oil products in the Siberian Federal District. Anatoly Golomolzin outlined the relevant FAS efforts:  “None of the market participants escapes FAS control. If conditions for restricting competition and violating the antimonopoly law are created, FAS reacts promptly. Only in 2018 FAS issued around ten warnings and admonitions to the market participants.”

Deputy Head of FASanalyzed the trends on the oil products markets and highlighted the measures adopted by the Russian Government to stabilize prices.

“Significant changes are taking place in taxation. In the near future, amendments to the Tax Law can be adopted to finalize the tax maneuver.  In this situation it is essential that all who are involved in the chain from oil production to refinery, sales in larger, small wholesale and retail segments, take measures to maintain sustainable market trends” emphasizedAnatoly Golomolzin.

The participants exchanged opinions and proposals on the work in this direction.

“All of us are on the same boat so instead of one position dominating others, there should be a consensus between small companies, large companies, independent fuelling stations and regulators. We all should understand that the goal is to achieve stability in this field”, commented Deputy Head of FAS.

A detailed discussion also focused on growing prices in small and large wholesale segments on the fuel market, the reasons and the level of price changes as well as the prospects of developing small wholesale exchange trade.

“Independent fueling stations rightly raise an issue of symmetrical price changes in large and small wholesale segments. For instance, if prices in the large wholesale segment increases and prices in small wholesale are growing proportionately, then when prices reduce in the large wholesale segment, they also should go down in the small wholesale segment proportionately. FAS has drafted a relevant decision. The Antimonopoly Service will control the conduct of market players under the frame of statutory procedural norms”, stated Anatoly Golomolzin.

He explained that several factors influence the growth of prices: taxation changes are one of the most significant factors (tax accounts for around 65% of the costs per liter of petrol). In the past two years excises for petrol doubled and increased by 2-3 timed for diesel fuel. External market trends also affect the pricing conditions, said Anatoly Golomolzin.

Exchange trading, on the contrary helps reduce prices. “In 2018 exchange prices were below prices on comparable foreign markets by 10-15 % because oil companies trade the volumes on the exchange sufficient to satisfy solvent demand”, pointed out Deputy Head of FAS.