Oil companies have to post simultaneously the price increases for fuels, Competition Council decides

Oil companies have to post simultaneously the price increase for fuels, so companies do not influence each other, given that the competition on the fuel market is low, a press release from the Competition Council informs on Monday.

The Competition Council’s investigation has confirmed that one leader dominates half of the market, with direct consequences on the fuels’ retail price change, the leading company being, usually, the one which initiates the price change.

CC does not nominate the company, however market leader is OMV Petrom, with more than 700 gas stations countrywide under the brands of OMV and Petrom. On the domestic market the other players are Rompetrol, Lukoil, Mol, Socar and Gazprom.

The Council’s report reveals that every company monitors the competition and reacts to the price changes. The competing companies prefer to have a similar behavior with the leader in terms of price changes, with enforcement in less than 24 hours.

“In this context, the competition on the fuel retail market is weak, which reflects in the fuel prices. Consequently, in view of increasing the competition in this field, the Competition Council supports the elaboration of a normative act to establish weekly price changes, the days when the changes are implemented and the hour, valid for all companies on the market, with no restriction when it comes to price cuts,” the Competition Council informs.

The fuels price structure reveals that the excise duty and the VAT have a share of about 50% in the final price.

According to recent figures released by the European Commission, Romania is among the European countries with the lowest final prices, without tax, below the European average – both for petrol and diesel fuel. The final prices of petrol with tax are also below the European average, the price of diesel fuel being very close to the European average.