Filenews 29 June 2022 - by Pambos Charalambous
At a time when increases in fuel prices have no end and in which consumers are suffering financially, as the cost of living is rising dangerously, inevitably, the "fire" of citizens is also directed against oil companies and gas station owners.
In fact, at a recent meeting of the House Energy and Trade Committee, in which the increase in the price of fuel was discussed, the CEO of Staroil, George Petrou, was forced to answer that "companies are not thieves". More generally, at that time, the representatives of the oil companies in Cyprus had characterized as unsubstantiated and slanderous the accusations of profiteering in the fuel sector. After all, how are fuel prices determined in Cyprus?
The comparison
The petroleum products imported into Cyprus, such as gasoline, diesel and heating oil, are ready-made (refined products) and essentially domestic demand is covered entirely through the import of refined products. For the pricing of refined fuels, the Platts index is used, in contrast to crude oil for the pricing of which the BRENT index is used.
The Platts index is an indicator that provides, globally and on a daily basis, an estimate of the price of finished refined energy products. Each fuel has its own variance and a different rated Platts value.
Here it should be noted that the daily index "Platts Basis Italy" is used for the pricing of refined products imported into Cyprus, which is influenced – among other things – by the demand and supply of refined fuels in the Mediterranean region.
Therefore, Cypriot consumers, who want to compare the level of accuracy in our country with other EU countries, should make the comparison with countries with which Cyprus maintains a common price base, namely with Greece and Italy. For example, comparing the fuel prices of Cyprus with those of the Central European countries is not appropriate, as these countries use a different indicator.
According to the latest data, dated June 20, of the EU for the average retail prices of petroleum products, which were in force in the 27 EU Member States on Monday of the same week, the price of unleaded 95-octane gasoline in Cyprus was at €1.80, compared to €2.42 in Greece and €2.06 in Italy.
Prices before tax in Cyprus were at €1.14, compared to €1.24 in Greece and €1.21 in Italy.
Regarding diesel fuel, the average selling price in Cyprus was at €1.88, compared to €2.11 in Greece and €2.01 in Italy.
Pre-tax prices in Cyprus were at €1.24, compared to €1.28 in Greece and €1.28 in Italy.
The factors
As mentioned to us by market connoisseurs, the factors that affect the final prices of petroleum products are several and specifically the following:
• International Raw Material Price (Crude Oil)
• International Base Prices of Petroleum Products (Gasoline, Diesel, etc.)
• Currency Exchange Rate € /$
• Duties & Taxes
• Existence of Production Units (Refineries)
• Cost of Transporting products
• Cost of investments and operation of product facilities
• Obligation to blend Biofuels in the final product
• Cost of Strategic Stocks
• Market Size
• Gross Marketing Margin
