Croatia: Oil market liberalization, prices changes ahead

, SEE Energy News

The prices of petroleum products in Croatia could be free formed soon, because with the markets opening and the more companies appearance in the oil products market have been met the repeal requirements for the Rules on determination of the highest retail prices, considered in the Ministry of Economy, which has opened consultation with the public interested in the new low proposal of the oil products market.

The Ministry published the draft law on its website, and consultation with the public lasts from 7th to 21st November.

As the most important news of the bill, in the Ministry point out the planning of the legal status of the Croatian Agency for petroleum and petroleum products, considering that in May this year, with the budget revision, that agency has been included in the budget of the Ministry of Economy, as a budget user who does its business over the state treasury.

By the new law on oil market it has been determined the formation liability of the commitment and operation stocks of oil products and dealing with cases of extraordinary disturbance in market supply by oil and petroleum products.

Also, the new law does not provide the adoption of the Rules on determination of the highest retail prices. In fact, as explained in the Ministry, in the EU countries the petroleum products prices are formed according to market principles.

“Considering the market opening in the Republic of Croatia and the appearance of several energy companies in the oil derivatives market have been met conditions for the repeal of Rules on the determination of the highest retail prices. By the new proposed law it has been provided that the petroleum products price would be freely formed”, said Deputy Minister of Economy Jelena Zrinski Berger.

As a result, it is expected a healthy market competition among distributors of petroleum products, so she points out that thus encourage investment in the retail petroleum products.

“We expect long-term a favorable impacts on the petroleum products pricing in accordance with good practice of other European Union countries”, says Zrinski Berger.

She points out that by the new proposed law it has been predicted that the RC Government, for the consumer protection purpose, market regulation or other legitimate reasons, could prescribe the highest level price for certain oil products for a period no longer than 90 days.

In the Ministry expect the new law on oil and oil products to be passed by the end of this year.

In Croatia, the prices of petroleum products have been regulated for a decade by rules on determining of these prices,  and currently is effective the Rules on determination of the highest retail prices passed in 2011th which was changed several times.

According the present provisions of this Regulation, the Ministry of Economy develops and publishes the highest level of retail prices of petroleum products every two weeks, and the changes largely depend on the prices movement of petroleum products in the Mediterranean market and the U.S. dollar exchange rate. The maximum permissible change in the retail price is of most three percent in the case of growth, and maximum of six per cent in the case of falling prices.

Source; Serbia Energy See desk

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