Russian PM fails to get oil giants to keep gas prices down
Prime Minister Mikhail Fradkov met Russia’s leading oil companies to negotiate curbing galloping gasoline
prices. No break-through has been made, but still gas prices are likely to go down, mostly due to external
factors.
The meeting was convened to discuss curbing consumer prices. However, the meeting included only economic officials
and representatives of oil companies. Apparently, authorities were set to discuss the gasoline component in the
overall inflation. Prime Minister Fradkov made it clear that “prices on oil products contribute for the bulk to
the inflation growth.” Gasoline prices rose 5.4 % in August, totalling 9.3 % since start of the year. Inflation
comes to 7.1 % so far.
The government thinks that oil companies received enough benefits and privileges to be able to keep prices low.
Economic Development Minister German Gref reminded that most agreements with oil companies to curb oil prices have
been kept and there are no reasons for the price rise.
German Gref mentioned such moves as introducing period of grace for developing new oil deposits, reducing natural
resources extraction tax for worked-out deposits and others. The measures were taken early this year in exchange for
gasoline price moratorium.
In their turn, oil giants are pressing for more privileges. LUKoil’s head Vagit Alekperov said the prices may
go down if the government and oil companies draft “a new set of steps to encourage investments in oil
refining”. He thinks natural resources extraction tax must not be geared to world oil prices so that
international prices do not influence Russian domestic.
The oil companies and officials did not find common ground but were not at all disappointed by this fact. The two
parties noted that oil prices had already reached their peak and predicted the price growth to stop, or even reverse.
Thus, the parties left the White House with no break-though.
The gas prices moratorium is still on but no additional agreements have been signed.
