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Fuels are becoming cheaper in world markets and expensive in the Greek

04 December 2014 / 18:12:29  GRReporter
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Since the beginning of summer, when the biggest drop in oil prices began, retail petrol prices in Greece have fallen by about 20%. However, the latest data of the European Commission show that the price of unleaded petrol in Greece is among the four highest in the 28 member states.

According to Bloomberg, Greece ranks second in the euro zone and fifth among 61 countries in terms of the percentage of income spent on petrol. Analysts say this is mainly due to the high taxes, which represent 63.47% of the end price of petrol, as is clear from the most recent data of the Ministry of Development.

But even before taxes, fuel prices in Greece are high and above the average in the European Union. This is indicative of the delayed responses of the domestic market to the decline in international prices. However, when they rise, then the entire Greek system is immediately activated and retail prices instantly increase.

According to the Directorate General "Energy" of the European Commission, the price of unleaded petrol in Greece before tax is the 13th highest among the 28 member states. On 24 November it amounted to 588.31 euro/1,000 litres (0.58831 euro/litre), i.e. around 6.4 euro per 1,000 litres higher than the average price in the European Union. Compared with the average price in the euro area, 589.92 euro/1,000 litres, unleaded petrol in Greece is slightly cheaper - with a mere 1.51 euro per 1,000 litres of fuel. Only 8 of the 18 euro area member states have higher prices than those in Greece.

At the same time, consumers in the country have not benefited from the decline in oil prices by about 1/3 compared to their highest value in 2014. Representatives of the fuel market state for the economic newspaper "Imerisia" that the prices of petroleum products are determined separately at petroleum exchanges that negotiate the agreements for petrol and other products. According to them, the prices may be affected by the general trend but do not follow it and have their own ranges. Furthermore, they add that due to the taxes in Greece, when the wholesale price decreases by 10%, the retail price decreases by 4% because the taxes constitute about 60% of the end price.

In recent weeks, the 4% has even decreased, since taxation has reached 63%, whereas the gross margin of trade and transport companies and of petrol stations has become 7.22%.

According to them, the decline in international oil prices significantly affects the price of heating oil because of its lower taxes.

The fact that retail prices in Greece are still high despite the fall in international oil prices has driven the Athens prosecutor's office to order the conduct of a preliminary investigation. The responsible prosecutor will have to establish whether there is speculation in the Greek market or other violations related to the prices of fuels.

Tags: EconomyMarketsFuelsPricesTaxesProsecutor's investigation
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