Wholesale Gasoline Prices Continue to Fall
According to Rosstat, the Russian state statistics service, the consumer price for gasoline dropped 0.7 percent in January and February 2007, while the producers' price dropped 11.9 percent. Wholesale and retail gas prices have been falling since the autumn of last year. Retails prices have barely fallen, while wholesale prices have gone down almost a third. They are now lower than they were a year ago.
The price dynamics of gas at the refinery has long followed the price of oil. The domestic price of oil differs for, quotations on Urals oil (partially by being more volatile), but the domestic price for oil has correlated with export prices rather closely until recent times.
A year ago, a government price freeze and falling wholesale prices still did not lead to lower retail gas prices. According to the last review made by Renaissance Capital, petroleum product exports, which are made on the basis of long-term contracts, are unprofitable at the moment.
Deliveries of oil to Russian refineries have been growing since the middle of last year, even as wholesale prices for petroleum products have fallen. An excise tax on petroleum products payable by the refineries was reimposed at the beginning of this year. It is possible that greater price competition will be seen at the gas pumps this summer.
www.kommersant.com
All the Article in Russian as of Mar. 29, 2007
|
