Govt Reintroduces Regulation of Heating Oil Prices

By , 21 Oct 2021, 12:02 PM Business
Govt Reintroduces Regulation of Heating Oil Prices WolfBlur CC-by-0

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STA, 20 October 2021 - The government reintroduced administered pricing of heating oil by issuing a regulation on the pricing of petroleum products at Wednesday's correspondence session. The distributors' margin has been limited to a maximum of six cents per litre of heating oil.

Pricing will be based on the prescribed methodology as the average 14-day price of the current period, says a press release by the Government Communication Office.

The first day of the average 14-day selling price of the current period, without duties, will be the period from 25 October to 5 November, and the first day of regulated prices kicking in will therefore be 9 November.

The government has decided for the same format of administered pricing of heating oil as in the period before liberalisation of heating oil prices in April 2016.

The possibility of such a move was floated by Economy Minister Zdravko Počivalšek on Tuesday in the wake of escalating energy prices.

The government paid special attention to heating oil price trends due to the upcoming heating season. The retail price of heating oil in the second half of this year has exceeded the 1 euro mark, with a litre already costing EUR 1.10 in October. Taxes and levies have remained unchanged.

A thorough analysis of the situation in the oil product market following last year's liberalisation of oil product prices has found that the market is functioning in Slovenia, the Economy Ministry said, adding that none of the companies had been standing out significantly price-wise.

Price increases are not disproportionate to the international environment or to prices in the industry, the ministry said.

The government decided to reintroduce administered pricing of heating oil in the evening after it got acquainted with a report by a task force to contain energy prices.

In the afternoon, during a regular session, the government discussed potential measures limited to proposals identified as acceptable by the European Commission. Guidelines on state aids were also taken into consideration.

On Monday, Prime Minister Janez Janša announced concrete measures after the EU summit starting on Thursday. The topic will also be discussed next week by EU ministers in charge of energy.

Janša mentioned regulating margins on energy prices and energy vouchers for households at risk as two possible options.

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