As the price of oil keeps tumbling, now standing at well below $50 a barrel, consumers are rightly expecting that the price of fuel at the pump ought to reflect the dramatic changes taking place in the world’s oil market.
As is to be expected, a statement about this made by a shadow minister before the upheaval in the stock markets, unleashed a torrent of responses in websites. Most were the usual political drivel, not worth going over, but there were others that hit at the core of the argument and made a great deal of sense.
The shadow minister, Marthese Portelli, must have reflected the views of many when she made the point that consumers are not benefitting from the drop in the price of fuel. She remarked that when oil cost $123 a barrel, unleaded petrol cost €1.38 per litre at the pump and diesel, €1.31 per litre. Now that the price of oil was less than $50 a barrel, petrol was selling at €1.35 per litre and diesel, €1.26 per litre.
The government argues the petrol price at the pump is lower than the average price in the EU. However, many hold that, even so, the price ought to be brought down to reflect the sharp drop in the price of oil.
Others quite rightly argue that there are a number of other relevant costs that have to be taken into consideration in the consumer price of petrol at the pump, such as refinery and transport costs. Another factor is the currency at which the oil is bought.
The problem, as always, is that the government does not inform the people of how the price is arrived at. The Labour Party lost no time in replying to the shadow minister, saying petrol cost 13c less than theEuropean average and consumers in some seven European countries were paying more.
The party said Maltese families and businesses knew that in the first part of this legislature the price of petrol had already gone down eight times and that of diesel seven times. On the other hand, the Nationalist administration had increased the price of fuel by 36 per cent and that of electricity by 71 per cent when the international price of oil had gone up by four per cent.
It did not say over what period, but if the figures are correct, the point is well taken. However, to those who are not in the least interested in the political parties’ constant urge to score political goals, the shadow minister’s point is valid.
The seven countries where consumers are paying more for petrol than consumers in Malta were, according to EU Commission figures, Denmark, Finland, France, Germany, Italy, the Netherlands and the UK. In these countries people have a higher living standard.
Among the countries where the price is lower are Belgium, Austria, Croatia, Cyprus, Estonia, Luxembourg and the Czech Republic. The list provides much food for thought. Maybe it is time for the government to be more open and inform the consumer what the situation is exactly insofar as hedging agreements are concerned, and, also, how exactly it is financing the cuts in the energy tariffs.
It is time too for the Competition and Consumer Authority to inform the public about the stage reached in its investigation into the case of a Rabat petrol station that had not been allowed to reduce the price of diesel over six months ago.