Russia restrains the price of petroleum products
Before the presidential elections in Russia the state committed itself to a policy of containment of prices for petroleum products to retailers. By this, Russia is seeking to avoid conflict between the sellers of oil and FAS already having a bitter experience of the events in 2011 in the same issue.
Oil companies will be able to raise prices closer to summer when demand for oil is maximal. Bashneft, Rosneft and other vertically integrated oil companies (VIOC) perceive the careful inspection by the FAS and the imposing of prices from the state without much excitement. These companies will be able to eventually regain all the money they have lost from sales of petroleum products.
The refueling stations are not satisfied with the Russian policy to “freeze†the price of oil because such small networks do not have other sources to offset the losses.
The most comfortable position in the fuel market is attributed to the companies for which the ratio of producing and processing of the petroleum products is low (Bashneft and Surgutneftegaz).
The Russian government is likely to continue restraining the prices for the petroleum products at least till the day of the presidential elections. Otherwise, the VIOCs will reorient to the exporting of oil.
