The price of fuel is rising without the National Commission of Markets and Competition being able to confirm that oil companies are using the bonus offered by the Government to offset the increase in gasoline and diesel. The agency has not yet detected any attempt to increase fuel prices in a setting where they receive a minimum state assistance of 15 eurocs per liter, and up to 20 for SME service stations.
This was Nadia Calvino’s insinuation at the start of the month. The Executive checked how much the pumps were increasing and took part of the bonus. The head of the Economy warned energy companies that they could raise prices by “absorbing” aid and would be punished by the government. They were not allowed to extend their subsidies beyond June 30. She stated that she was analyzing which measures are most effective and if it is found that operators are raising prices or absorbing aids, they will be withdrawn.
The CNMC has been closely studying gross fuel margins since the bonus was implemented to prevent any ‘absorption effect’. According to sources at the agency, the CNMC has seen a decrease in the margins, and even a narrowing, as a result of his recent study. Even more, the Commission points out that operators are trying attract more sales to their facilities by offering prices that, within the limits of the maximums in the which they move, will be competitive among the different fuel brands.
According to the Competition analysis, the increase is a result of the steady rise in international prices. Brent’s barrel is currently trading at 112 dollars, and has not fallen below 100 since Easter. The shortage of diesel, which is the main source of most of the diesel used in Europe, exacerbated this situation. According to the CNMC, this has caused the fuel’s price to rise for several weeks above that of gasoline. These price increases are also attributed to the decline in the euro/dollar exchange rate. This makes oil and its derivatives, which are based on the dollar, more costly.
Competition expects a drop in diesel prices on international markets, which should be transferred to Spain’s prices. According to the EU’s last Bulletin of Petroleum Products, gasoline prices have risen to 1.89 euros per gallon, exceeding diesel’s 1,88 euro mark. The first example shows a 10 cent increase since the beginning of the bonus. In the second instance, it is nearly at the same level.
These data allow the Government to continue to examine how to extend fuel bonus beyond June 30, when current aid ends. The economy does not rule out the possibility of adjusting the measure to restrict it to those with lower incomes, given that fuels will remain at high levels until 2022.
