Serbia: Oil distributors complaint on newly introduced state capacities rules, negative impact on the oil market and consumers

6. August 2013. / News Serbia Energy

No matter in which way some oil company tries to prove that it could be competitive in wholesale of oil distribution also with small storage capacities, Ministry of Trade will ask from it to construct or rent 5.000 cubic meters of reservoir place for diesel fuels, 2.000 m3 for benzene and 1.000 for  liquid oil gas.

Experiences from other countries in the region shows that  maximum storage capacities, for example in Slovenia are 40 cubic meters, in Croatia 300 cubic meters, but  also in the most European states wholesalers decide which capacity is the most rational- say in the Association of Serbia Oil Companies UNKS.

In UNKS evaluated that with imposition of this type of rules and with totally unreasonable obligation, Ministry of Trade only will contribute to costs increase for company work and indirectly to rise in oil price. This certainly is not in consumer interest, and because of production reducing that will come after price increase, but also in oil companies and state interest.

As stated in clause 5 of Law of trade, “every aspect of discrimination related to trading conditions is forbidden”, and by Rulebook about minimal technical conditions Ministry of Trade plans to set up conditions opposite to principles of free market and equality. State remained completely deaf on multiple appeals of Association of Serbia Oil Companies, which gathers the most important subjects in oil industry, like companies OMV, LUKOIL, EKO, MOL, Petrobart, Naftachem, INA, Standard gas, Igmin Petrol and Speed, that market arrangement should start with introducing of efficient state system of oil currency and quality, and not by competition of overextended storage capacities by witch it has been reduce free competition just before starting  harmonization process with European Union principles- stated in UNKS.

In UNKS pointed that thanks to Ministry of Energy comprehension and support, during last year excises on fuel oil and biodiesel were introduced, by which was prevented further needless use of that energetics. In that period state budget was cut for near 80 million EUR, and state control system did not register any issues.

State goal but also goal of oil companies and consumers is the same in this case, states in UNKS, but the market arrangement cannot justify introducing of so rigid requests for minimal reservoir space, by which at the end the companies will dispose only in order to show documents to Ministry of Energy, and efficiently will not have need to use it. UNKS invites authorities to review one more time planned measures in order that Serbian market would not be more further from European Union market and specially before starting accession talks with EU.

Source; Serbia Energy/UNKS

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