Russian Fuel Share on Georgian Market Increases from 5% to 27% in 2014-2018
The share of Russian fuel imported into Georgia increased from 5% to 27% from 2014 to 2018 and is leading among the fuel importer countries.
83% of imported fuel comes from four countries: Russia, Romania, Azerbaijan and Turkmenistan. In 2014-2018, the cheapest fuel was imported from Azerbaijan but the largest share from Russia.
The information was released by Transparency International Georgia (TI) which carried out a study of the Georgia’s automobile fuel market in 2014-2018.
The organization says that competition on the fuel market has increased since 2013.
“From 2012 to 2018, the number of fuel importers increased from 7 to 57. During the same period, the market share of large companies decreased from 93.4% to 69.5%,” TI Georgia reports.
The NGO says Georgia fully depends on imported fuel. Further, in 2018, the value of imported oil and oil products reached $864 million, which is 9.5% of the total imports.
The NGO notes the automobile fuel business is an important source of budget revenue for the state.
In addition, last year, taxes collected from this business amounted to GEL 1.3 billion, which is a tenth of the total tax revenue. Turnover of automobile fuel retailers exceeded GEL 3 billion in 2017 and amounted to GEL 2.5 billion in nine months of 2018.
10,050 people are employed in automobile fuel retailing and this figure increases from year to year, according to the study.
In terms of the prices of fuel, the NGO says the fluctuation of fuel prices mainly depends on world oil prices, the exchange rate and excise tax rates.
The survey revealed that in the last five years, the global oil price has decreased by 48%, but this was not reflected on local fuel prices as Georgian currency depreciated by 53% and excise tax on fuel increased.
From January 1, 2017, the excise tax per ton of petrol increased from GEL 250 to 500 and the excise tax per ton of diesel increased from GEL 150 to 400.
Regarding the quality of fuel, the NGO notes that in recent years, the government has tightened automobile fuel standards. “The Environmental Supervision Department periodically inspects gas stations - in December 2018, lab tests revealed no excess lead in fuel,” reads the report.
It also says that the TI Georgia tested the fuel quality of eight companies through a private lab, adding all studied samples, except one, met all the standards set out in the Government decrees.
Furthermore, a public opinion poll of Transparency International Georgia has shown that nearly half of the population (46%) owns a car and when choosing fuel, they pay most attention to the price followed by the quality.
By Thea Morrison
Image source: auto.ndtv.com