ECONOMY

Fuel prices still pose a problem

Although the issue of wide differences in fuel prices has been a recurrent theme in recent years, the responsible agency, the Competition Commission, has exhibited a dire lack of urgency in getting to grips with the problem. This means that it has failed to establish the extent of distortions in the production and distribution networks which are estimated to cost billions of euros to consumers. For their part, governments attempting to ameliorate the problem have kept fuel taxes the lowest in the eurozone. The Competition Commission only recently started looking into the problem after instructions by the overseeing minister for development, Dimitris Sioufas. The discussions have started and although officials contend that the matter will be closed by the end of the year at the latest, the result is widely considered uncertain. Competition Commission President Spyros Zisimopoulos yesterday started a round of contacts with representatives of the sector’s main interested parties, beginning with the head of the Gasoline Retailers’ Federation, Dimitris Makryvelios, in an attempt «to understand the problems and the possible effect on the smooth functioning of the market.» Further meetings will follow with representatives of the refining and marketing segments. The Commission can publish the views of the participants within two months and recommend measures that would promote conditions of effective competition. Sioufas again noted yesterday that Greek unleaded gasoline prices are among the lowest in the European Union and ruled out subsidies to heating fuel prices for low-income households in the coming winter. Nevertheless, the ministry seems to be giving much consideration to a proposal by Kathimerini for the abolition of the tax differential between heating fuel and automotive diesel – which gives rise to extensive illegal distribution. Even though the international price of oil is now receding after a recent rally and is now around $70 a barrel, this has not yet filtered through to the Greek market. When questioned, Makryvelios said that the price of unleaded gasoline today varies between 0.96 and 1.10 euros per liter and that prices are on the decline. Meanwhile, sources said that a probe started about two years ago into the distribution sector is expected to result in heavy fines for BP and Shell for following a harmonized discount policy, which maintains a permanent non-competitive relationship between them in the pricing of unleaded gasoline. It is said that the fines will total 107 million euros.