Connect with us

Hi, what are you looking for?

Economy

Soon we will cut ourselves off from fuel supplies from Russia. How will this affect their prices?

Portal i forum dla transportu i logistyki

In June this year EU leaders decided to impose Russian oil embargo Imported by sea. The penalty will take effect on December 5. In addition, from February 5, 2023, a ban will be introduced on the import of petroleum products (including, among other things, diesel oil) from Russia.

Theoretically, oil could still flow to Poland and Europe through the “Friendship” pipeline, but both Poland and Germany have announced their intention to stop importing raw materials in this way.

Will the oil run out?

Rafai Bogoki, fuel market expert at e-Petrol, argues that oil supply shouldn’t be much of a problem.

We will deal with the oil issue. There are many sources from which oil can be imported – the United States, the Middle East, West Africa or South America,” Bogoki says.

Indeed, this year witnessed a far-reaching change in the trends of oil supplies to our country. In the second quarter, just over half of the crude oil Poland imported came from Russia, according to NBP data. However, 1/3 came to us from Saudi Arabia. Shipments from Saudi Arabia tripled year on year.

influence on prices

An expert on e-gasoline expects some uptick in oil prices after the December ban. He explains that this will be affected by the logistical change that needs to happen in the market. The world’s oil export and import trends will change, which will translate into the price of a barrel of oil.

On the other hand, Urszula Cieślak of BM Reflex believes that the oil embargo alone should not have a significant impact on the level of raw material prices. He notes that European governments have stockpiled some, and shipments shipped before Dec. 4 will still be on the market for a few more weeks.

See also  Activision Blizzard sued Microsoft

The higher VAT will return

However, the expert mentions this We pay more for fuel anyway since the beginning of the year. And it will not be associated with any penalties and bans. The government has already announced the end of the fuel inflation shield, which will include a 23 percent recovery. VAT rates on fuel. The consumption tax will also increase (due to exchange rates).

“Just like last year, lowering these rates made us pay less for fuel, so now we have the exact opposite situation,” explains Cieślak.

The increase in prices at stations due to the return of the old value-added tax rate and the increase in excise tax will mainly concern individual customers, not carriers. This is due to the fact that truck users don’t pay VAT on fuel anyway, deducting it as part of their operating costs. When the VAT rate on fuel was lower, tankers could deduct less, and thus pay more to the tax office. The yield is 23% so rates shouldn’t be much of a cause for concern for carriers.

The silence before the hurricane?

So experts are not particularly afraid of the fallout from the December ban.

“The most difficult issue is the embargo on the supply of petroleum products,” says Dr. Bogoki.

This ban, which is due to take effect in February next year, may be more difficult for European countries to bear. And also for Transport sector. This limitation includes blocking the way to Europe for cheaper Russian diesel.

“All Europeans will look for diesel, and this will naturally raise its prices,” – believes Dr. Bogoki.

See also  Strong increases in grain prices in global exchanges

There should be no problems with the availability of diesel oil, explains the e-gasoline expert. Poland has access to the sea, it has an oil port and already imports large amounts of oil and diesel through this route.

As in the case of oil, the share of fuel supplies from Russia has also decreased significantly this year. While 48 percent of imports in the first quarter came from Russia. Fuel imported by Poland, in the middle of this year was only 26 percent. However, much of the domestic demand still needs to be replaced.

logistical challenge

The Baltic Sea is quite shallow, and inaccessible to the largest tankers, which means that the fuel they transport must be offloaded and reloaded onto smaller ships arriving at Polish ports. This process is quite feasible, but it means another link in the supply chain, for which you will have to pay more.

Urszula Cieślak of BM Reflex also noted the potential impact of logistical issues on pricing.

“Poland is ready (to cut off Russian diesels), because we have sources of supply, but others will need them too, so the question of logistics remains – and this could cause some disruptions in the diesel market,” explains Ursula Çelak. He adds that these will not be disturbances related to fuel shortages, but rather price disturbances.

Although Polish analysts are optimistic about the security of supplies, experts in the West are full of concerns. According to analysts from Argus Media, Europe may face serious supply disruptions. They claim that – yes, it is possible to get diesel from India or the Middle East, but perhaps at high prices, because you will have to compete for fuel with countries from Asia.

See also  Russian gas. Gazprom has stopped deliveries to France

The problem, however, is record low diesel stocks in Europe. Rising gas prices and the burden of emissions costs have led refiners to prefer using fuel stocks rather than processing crude oil this year. As a result, according to Argus Media, the level of stocks of petroleum products in 16 large European economies was the lowest since 2008. In the Netherlands, which is rich in fuel storage facilities, the level of stocks of diesel was 40% higher in August. . on an annual basis. In other countries the rate is lower (eg 10% in Germany and 12% in the UK), but it shows the scale of the problem.

It will be more expensive

Transport companies are very concerned about whether the ban will affect the price of diesel fuel at gas stations. After price hikes following the war in Ukraine, fuel prices were estimated to be about half that carrier costs.

claims d. Bogoki it is difficult to predict, if only because of the limited information policy regarding potential fuel sources. However, the need to import more expensive diesel fuel from Russia and import it from far away should in itself translate into the price level.

“The change can be felt. It will not be small, ”- Dr. Bogoki estimates. He adds that the price increase of several dozen is real. To this you will have to add the previously mentioned increases in VAT and excise duty.

Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

You May Also Like

Tech

Another person familiar with Sony’s plans confirms the killer news for PS5 owners. Horizon Forbidden West is not expected to appear on the market...

World

The British government has canceled a recommendation to avoid travel to and from the eight regions most affected by the Indian coronavirus variant altogether....

Economy

It looks like Tesla wants to use lasers instead of standard wipers in the future. I applied for a patent for this solution. The...

Economy

Farmer reveals government plans for CPK The farmer who issued the documents is a member of the social council of the CPK. As he...