The ANC explained why this would happen. The reason for this is the reduction in the volume of fuel production in Russia and, as a result, the increase in sales prices at refineries (refineries) of the Russian Federation.
- In spring and summer, many companies carry out planned modernization works. In particular, the large refineries in Orsk and Perm, which supply products to Kyrgyzstan, have been under repair since April 2023. Since June, the Omsk plant will do the same. Moreover, after the introduction of a ceiling price for Russian oil, the volume of its production decreased. All this has led to an increase in the prices of fuel and lubricants, the association explained.
According to the association, the cost of gasoline on the St. Petersburg Commodity Exchange in May renewed its historical maximum and approached 62,000 rubles per ton.
- Today, the Russian authorities are discussing the possibility of introducing a temporary ban on fuel exports in order to avoid its shortage and further price increases in the country. In this regard, local suppliers are having difficulty supplying the republic with fuel and lubricants in June. Today, the acute problem is not the selling price, but the availability of fuel and lubricants for deliveries to Kyrgyzstan, the ANC noted.
As the association explained, since April 2023, AI-92 gasoline is sold with negative profitability, which is leveled by the sale of diesel fuel. But given the current circumstances, Republican oil traders are forced to gradually increase retail prices in the near future.
The Antimonopoly Regulatory Service responded to the alert on rising fuel prices, whose employees met with representatives of companies and associations and gave them several recommendations. In particular, strictly comply with the requirements of competition law; react quickly to changes in the internal market; prevent a sharp increase in the prices of petroleum products and liquefied gas; respond promptly to requests from the Antimonopoly Service; provide the reserves of fuel and lubricants necessary to saturate the market and prevent shortages of petroleum products; carry out work the purpose of which is to control and prevent underfilling at service stations.
The Ministry of Economy and Trade of the Kyrgyz Republic, in turn, proposed to change the list of socially significant goods, the prices of which can be regulated by the state if necessary. Coal, AI-80 and AI-92 gasoline, diesel fuel, liquefied gas, mineral fertilizers, animal feed (hay and straw) can be added to the list.
The republic receives more than one million tons of duty-free fuel and lubricants from Russia annually under an agreement between the governments of the Kyrgyz Republic and the Russian Federation. The parties sign the so-called indicative balance sheet, which indicates the quantity and type of fuel that will be delivered to Kyrgyzstan. In 2023, according to official data, the country will be supplied with 460,000 tons of gasoline, 485,000 tons of diesel fuel, 150,000 tons of jet fuel, 50,000 tons of crude oil and 60,000 tons of petroleum bitumen.
In February 2023, the Ministry of Economy and Trade of the Kyrgyz Republic reported that an agreement had been reached on the uninterrupted supply of fuels and lubricants from the Russian Federation and on increasing their imports if necessary.
Russia is today the sole supplier of fuel and lubricants to Kyrgyzstan. In 2021-2022, more gasoline and diesel fuel were imported from the Russian Federation to the republic at the request of the Kyrgyz side. In addition, duty-free, which makes it possible to avoid sharp fluctuations in the retail prices of fuels and lubricants in the Kyrgyz Republic.
Akylbek Zhaparov, Head of the Cabinet of Ministers of the Kyrgyz Republic
Prices for fuels and lubricants in the republic are moderate and stable compared to other countries of the Eurasian Economic Union. We work closely with major oil distributors and traders. To support prices in the internal market of the Kyrgyz Republic, an agreement was reached to increase the volume of duty-free imports of gasoline and diesel fuel. Our market is highly dependent on imported products. The rise in world food prices also affects us. In 2022, we have allocated eight billion soms to ensure food security. A number of consumer goods were exempt from value added tax. For this reason, the state budget did not receive about 1.5 billion soms.
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