Board Awards Fixed by Debt Enterprises in Albania

The first is the closure of small companies, which are failing to survive in the face of frequent price changes from the Board. The Hidrocarbon Association announced to the Monitor that 83 shopping stations on the outskirts from Shkodra to Kukes, Pogradec, Debar, etc. have already closed. About 100 more dots are supplied once every three weeks and are barely surviving. These make up at least 10% of total gas stations in the country.

The Hidrocarbon Association said that if this situation continues, it is at risk and the supply of oil from import, as no one is negotiating a new contract. “The capital that is needed for work has been threefold, the banks and international funds covering the price of oil in the stock exchange have increased costs, as with market fluctuations, the risk of defaults has increased and there are 3- 4 doubled the advantages. Our board does not recognise these, nor many elements that are applying to the Platz Award, while distribution operators are playing for cent”.

If the Board didn't intervene, the prices would be 1015m cheaper per litre.

The Hidrocarbon Association says that if there were no interference from the Board, prices today would be at least $10.15 per litre less than they currently are. “Companies have the experience with prices and maneuver when it fluctuates on + 150, $200/ton, and if the price falls, they will buy more, able to make average costs. But with the interventions the Board makes today, which just sits in the Stock Exchange lowers the prices, all are closing only daily needs, because if it falls, the companies come up with minus”.

The association said the operators expected the Board to make transparency on the price, showing the cost of an oil liter (Platz price in the dollar, course, premium, national taxes, local taxes, operational expenditures based on accounting legal documents), which they think would facilitate and speculate and clarify paradox in the market.

According to the Board's recent decision, dated June 18th, the retail price of oil stands at 261m per litre, near the record record record 265m per litre. Compared to the end of February, before Russia's attacks on Ukraine began, prices are 34% higher. The board was set up early in March after oil on the domestic market reached 235m per litre in the early days of the war.

Is evasion on the rise?

Market operators claimed for the Monitor that the price fixing by the Board is affecting increased evasion in fuels, especially in the environment. According to one of these companies' sponsors, evasion is being done with declared quantities and in circles this phenomenon is becoming massive.

According to operators, the price change is bankrupting the young, that if they have a high-priced situation and the next day the board lowers the price, it is causing them to maneuver with the amounts declared at the pumps.

Measuring

For the entire 5-month period, oil imports marked a 6% decline, and the whole phenomenon focused on the last three months of March-May after the war started in Ukraine.

According to official data from the Ministry of Finance, oil imports marked about 44,000 tonnes in May, down from more than 54 thousand tonnes in the same period in 2021, at 18% decline. This was the strongest decline compared to the previous two months.

Market operators claim consumption is dropping daily. The gap from Shkodra to Montenegro is nearly one euro, and many vehicles are supplied across the border (even with other border states, besides Greece, there are high price differences per litre of oil). The weekend tourism is not affecting the increase in consumption, as all come with full tanks and expectations are low even for the summer season. Operators say that if oil were eased from taxes, at least for the three months of summer, it would affect lowering prices, while the state would be able to compensate through increased consumption, reduced evasion, while keeping jobs at gas stations that at current conditions endanger bankruptcy.