Business news

MINSK, 11 January (BelTA) – Belneftekhim Concern would like the prices for motor fuel in Belarus to be on par with those on the Russian market, Deputy Chairman of Belneftekhim Concern Andrei Rybakov said in an interview with BelTA.

He noted that in August-December 2017 the crude oil and petroleum products market underwent significant changes that had an impact on the Belarusian oil refineries. In December 2017 the world’s oil prices averaged $63.9 per 1 barrel, which was up 25.8% over the prices in August 2017 years ($50.8 per barrel).

“The increase in the cost of raw materials inevitably leads to the increase in the price for the finished product. In view of the high share of oil in the production of petroleum products (over 80%), we need the prices for petroleum products to increase by 23% in order to compensate for the losses of the oil refineries,” Andrei Rybakov said.

In addition, plans have been made to increase excise duties on motor fuel by 10% throughout 2018, which will also impair the economic efficiency of the oil refineries and will require taking measures to compensate for the losses by means of increasing fuel prices, he said.

Today, retail prices for motor fuel in Belarus are lower than the prices at the filling stations in the neighboring regions of Russia (petrol prices are about 15% cheaper, diesel – 11%). Prices on the Ukrainian market are 48-68% higher than in Belarus. Prices on the markets of the Baltic states and Poland are 101-129% higher depending on the type of the fuel.

“Profitability of the motor fuel production and sale on the domestic market of Belarus is in the negative territory at present. To make sure that the Belarusian customers continue to get high-quality petrol and diesel fuels from the domestic oil refineries, it is necessary to secure their profitability and sufficient financing to complete the modernization of the plants in order to improve the production of light oil products. In the present circumstances Belneftekhim believes it is necessary to bring Belarusian petrol prices on par with the prices on the Russian market. All possible measures to reduce production costs have been undertaken by the oil refineries,” the Belneftekhim deputy chairman said.