Update: Mangion: petrol and diesel should be cheaper

Labour spokesman for the Economy Charles Mangion said on Wednesday morning that the reduction of 6c in the price of petrol and 2c in the price of diesel does not reflect adequately the reduction that there should have been in prices of these essential products for families and businesses.

According tot he international prices of diesel and petrol and the rate of exchange between April and June 2012 the June price of petrol for July should have been reduced by 16c while that of diesel by 11c.

Mangion called on the Malta Resources Authority (MRA) as a regulator to explain in detail to consumers why the reduction in the international price of petrol and diesel is not passed on to consumers.

Between April and June 2012, the months during which fuel is purchased, the price of petrol in Dollars went down by 22.4% while that of diesel by 16.5%. When the exchange rate of the euro with the dollar is taken into consideration the price of petrol in euro went down by 18.6% and that of diesel went down by 12.4%. Mangion said: “It is up to MRA to explain how prices go up for consumers when the international prices go up and then do not go down for them when the international prices go down.”

Mangion said that the high fuel prices are causing hardship to families and making Malta less competitive and government is contributing to inflation in the country.

He said: “The price reduction is just an exercise in political deception and another instance where the regulator is failing in its duty to protect consumers.”

Mangion said it is not acceptable that regulators are simply serving the partisan interests of the government.

He accused government of mismanaging the economy and of pushing the country into recession instead of helping it to get out of it.

Enemalta's reply

Enemalta in reaction to MP Charles Mangion said that the price of fuel is determined by various factors. One of which is the 'Platts' international price of which the product of fuel is bought.

Another factor is the value of sales made ​​during the month, where it is reduced by the value of opening stock. On the basis of these considerations, the average price for petrol and diesel is computed for every tonne. It is worth mentioning that for the month of June there were no new deliveries of diesel and therefore the decrease resulted in prices from May to June (down 9.8% in terms of US Dollars) were not reflected similarly in the calculations of Enemalta.

According to the latest prices that were published by the European Commission on 2 July 2012, the prices of petrol and diesel in Malta are lower than the EU average. The prices of petrol and diesel in Malta are also below the EU average, that is Eur1.562/ltr and Eur1.415/ltr respectively. Enemalta pointed out that that the price of oil has recently increased by ten dollars per barrel and reached U.S. $100 a barrel due to several factors including  tensions regarding Iran and strikes in Norway in oil production. Furthermore the prices in other European countries are already adjusted as fuel prices are adjusted on a daily basis, something which does not happen in Malta.