ANRE seeks more transparency in fuel prices

The main problem with fuel prices is not that they are high, but rather that they are nontransparent: while one price is displayed at the pump, most of transactions are being conducted at a lower price, based on petrol vouchers and discount cards, says Victor Parlicov, the director of the National Energy Regulatory Agency (ANRE). The comment comes following the amendments approved by the Government on October 3 to the Law on the Fuel Market. In his opinion, it is possible to reduce prices without amending the legislation, provided that all the relevant authorities do their job right. ANRE data show that with the use of such nontransparent methods actual fuel prices are by 0.4-0.6 lei/liter lower than those displayed at the pump. In a press statement, ANRE said that that it repeatedly petitioned the Government and the Ministry of Economy to oblige fuel companies to sell only at prices displayed at the pump. According to ANRE, the amendments to the Law on the Fuel Market don't provide solutions for the trade based on fuel vouchers. In a bid to reduce fuel prices, the Government proposes that prices at the pump must be established based on Platts quotes, plus a margin of 30%, but no more than $0.2/liter for gasoline and $0.15/liter for diesel fuel, instead of using the value established at the customs (where the profit is already transferred to off-shore zones). The Government also proposed that major consumers of fuels, such as farmers, should be allowed to import fuels for their own use without acquiring an import license and without the right to sell. ANRE considers that the current administrative instruments, such as price capping, are inefficient on a competition-based market. It argues that if the amendments are enacted in the current version, there is the risk that the large importers could push the over 70 small-sized importers out of the market, which would be an opposite outcome than that meant when approving the measure. ANRE's estimations indicate that if the Platts quotes measure is introduced, fluctuations in prices at the pump would be greater. At the same time, ANRE has saluted the proposed requirements of 5,000 tonnes of storage capacity and 8 million lei equity capital for companies to be eligible for a license.