By Saule Tasboulatova
On Monday, September 9, the price of Brent oil dropped below 100 dollar mark per barrel. This news amid recent fuel price increase, petrol crises (probably, artificially supported by traders) and anticipation of yet another fuel price increase, raises a question. Why is petrol price going up in our country, if the price of barrel of oil is going down?
To recall, the government started to regulate the marginal prices for petrol and diesel fuel since 2012. One can easily recollect that since that moment the prices of fuel and lubricants were adjusted only to the high end. Although, the approved Rules for determining the marginal price consider the free market price of oil, and in our case it is the average quotation price in foreign currency of a standard grade of "Dated Brent" for the corresponding period.
By the way, it is not for the first time when the oil price falls lower than 100 dollar mark per barrel. Last year we observed it twice. However, in our country the fuel price is adjusted only towards increase. Why is it so?
Olzhas KhoudaibergenovWe asked the economist Olzhas Khoudaibergenov to comment on the situation:
- Yes, the price of oil fell below a psychological mark. In general, the oil price fell lower than $100 per barrel also in February of 2011, and in summer of 2012 when prices fell even lower than $90. Below $100 level it also fell in April and May of 2013, and currently we have the same story. From the point of view of tactics there are a lot of explanations - it is a retardation of the rates of economic growth in China, expectation of recession in Europe, increase in stocks, decrease in forecasts of growth of oil consumption, etc. However, the oil consumption constantly exceeds the offer, and even the lowered forecast of consumption growth means that next year the consumption will grow by 1,2 million barrels a day. Therefore the local analysis explains nothing, as these factors are almost constant.
Currently there are three versions as to how the situation will develop further. The first one is based on IEA forecasts that on the average next year the price of barrel will remain within $105 limit. According to the second version this year the prices of oil will go up. Moreover, the increase will be considerable before the fall that will follow right after. And according to the third version the prices will fall even lower already this year. Each scenario has their pro and con arguments. Therefore it is actually difficult to favor any of these versions. As for Kazakhstan, the critical level is $75-80 per barrel.
Probably, the government doesn't reduce petrol price for the following reason: KMG has enough saved-up fuel stocks in its fuel depots (the national company claimed so shortly before the crisis), and these stocks should be sold without loss. By the way, yesterday, after the publication of article "The fall without 92" in Ak Zhaik newspaper, KMG gas stations put petrol prices against Ai-92 and Ai-95, though the day before there were zeros. Probably, there is enough fuel, but it is artificially withheld in anticipation of price rise. After all, nobody knows how much stock of fuel wholesaledealers have in reality.