The State-owned fuel importer, Enemed, has refused to provide information on its “confidential” profit margin on fuel sales to petrol stations.
Enemed, which was established in 2014, runs the operations of Enemalta’s petroleum division.
Data published recently by Eurostat showed that Malta’s pre-tax fuel prices were the highest in the EU in the second half of 2015.
The data broke fuel prices down into two categories: pre-tax and at-the-pump prices.
Pre-tax petrol prices stood at 62c and diesel prices 63c per litre in Malta, while the EU average across 28 countries was 44c for both types of fuel.
Enemed reported revenues of €349 million and a pre-tax profit of €17.8 million in 2015.
A spokeswoman for Enemed refused to state the entity’s profit margin on fuel sales. The spokeswoman said Enemed operated in a commercial and competitive environment, so the information requested was considered to be confidential.
Enemed issues tenders periodically and has very strict procedures that the fuel procurement committee follows
The Maltese fuel market was liberalised in 2007, but price competition at the pumps has not yet materialised – both petrol and diesel are being sold at the rate established by Enemed.
While in the petrol sector Enemed enjoys a complete monopoly, there are a number of private importers in the diesel sector.
However, the lack of storage facilities is hindering these private operators from mounting a serious challenge to Enemed’s monopoly. When questioned if the high pre-tax fuel prices were down to Enemed’s profit margin on the price, the spokeswoman said the fixed margin charged by Enemed had not changed for the past five years.
She said in the past, Enemed had to make good for losses within Enemalta’s electricity division, while profits were now being used to refurbish infrastructure that had not been refurbished for the last 20 years.
Asked for a list of Enemed’s fuel sources and the prices paid, the spokeswoman said that since this information was confidential and commercial, it could not be disclosed.
The spokeswoman said that Enemed issued tenders periodically and had very strict procedures that the fuel procurement committee followed.
Asked to explain the high pre-tax cost of fuel, the spokeswoman said storage and shipping limitations put Malta at a disadvantage compared to other EU countries.
The spokeswoman said most countries in Europe sourced their fuel from major ports such as Rotterdam. A premium over and above this price had to be paid for fuel supplied in the Mediterranean, she said.
“In other countries the petrol stations are owned by the same company producing the fuel, while in Malta the cost also includes the commission given to the petrol station owners per litre of fuel,” the spokeswoman said.