Retail gasoline prices accelerated their growth again last week. According to Rosstat, the average price of a liter of gasoline increased by 24 kopecks over the past week. Premium grades of AI-98 and above saw a sharper rise, going up by 96 kopecks. Since the beginning of the year, the average price of gasoline at filling stations in Russia has risen by 3.72 rubles, or 7.2%, compared to an inflation rate of 5.34% over the same period.

On the stock exchange, however, the opposite trend is observed. Gasoline quotes have been declining since the end of last week. The price of AI-95 dropped by 5.5%, while AI-92 decreased by almost 10%. However, retail fuel prices in Russia tend to respond only to prolonged and significant upward or downward movements in exchange quotes. Therefore, it is unlikely that retail prices will start falling as early as next week.

As noted by Sergey Tereshkin, head of the OPEN OIL MARKET fuel marketplace, exchange prices for fuel have only an indirect impact on retail prices. Over 80% of gasoline sales occur in the off-exchange segment—shipments from refineries and oil depots.

Fuel station prices depend more on taxes and oil companies’ costs than on barrel quotes.

Off-exchange wholesale fuel prices generally follow exchange prices with some delay. For retail prices to respond to a decline in wholesale prices, even more time is needed, and the decline in quotes must continue consistently. A similar situation occurred in the market last fall, when gas station prices began to decrease after two weeks of falling exchange quotes.

According to Yaroslav Kabakov, Strategy Director at Finam Investment Company, gas station prices could drop following exchange prices this year, but it is not guaranteed. Gas station prices are influenced more by oil companies’ costs, taxes, and logistics than by exchange quotes, leading to uneven changes across gasoline grades.

Tereshkin believes that accelerated price growth at gas stations will continue for AI-98 and higher grades of gasoline. A serious threat to the fuel market, however, is the current drop in oil prices, which could prompt the Ministry of Finance to reduce subsidies under the damping mechanism (compensating part of oil companies’ costs from the budget for supplying fuel to the domestic market at prices below export levels). The expert recalls that a previous attempt to cut subsidies in July 2023 led to a rally in the fuel market, forcing the Ministry of Finance to revert to the previous damping configuration.

Translated using ChatGPT

Sourse: https://rg.ru/2024/09/12/slozhnyj-bak.html