Yesterday SOCAR President Rovnag Abdullayev said in Turkey that he has requested to form AI-95 gasoline price on the basis of the free market principles, but his proposal has not been accepted.
“As we know, big cars use gasoline with the octane rating 95. Why does the government need to subsidize owners of big jeeps and expensive cars? The gasoline with octane rating 95 and 98 must correspond to the world prices. The government subsidies diesel fuel and gasoline with the octane rating 92. We have changed the color of the gasoline with the octane rating 92 for the unprincipled people not to mix AI-92 with AI-95 gasoline,” Abdullayev said and added that he supports free price for high octane gasoline.
It follows from the statement of President of State Oil Company of Azerbaijan (SOCAR) that until now retail sale of fuel is subsidized by the state. However, the government’s reports and the reports of the international financial institutions about Azerbaijan say nothing about that. The audited financial reports of SOCAR also have no information about unprofitable sale of oil products at the local market. SOCAR President has most likely mixed subsidizing of the farmers’ costs for diesel fuel during the agricultural works -the government allocates 40 AZN per 1 hectare of land. There are no other subsidies for fuel in the country.
In addition, Azerbaijani oil refineries receive crude oil at the price of $10.00 per barrel. The retail fuel price in the country is high considering the ratio of average salary to gasoline price. Ai-98 gasoline, which is imported from Romania, costs 1.5 AZN or $1.91 at the local market. AI-95 costs 0.80 AZN or $1.02 per liter. However, Azerbaijani oil refineries are unable to make such gasoline. Heydar Aliyev oil refinery manufactures Ai-92 gasoline. It produces Ai-95 gasoline by using chemical additives to increase the octane rating. Therefore, thedrivers usually use this gasoline on the highway, because it is of no use in the traffic jams. If the car owner cares about his or her car, they would buy Ai-98.
Thus, it is unclear what did SOCAR President want to say with his statement? Did he mean selling Ai-95 to the Azerbaijani citizens at the European prices. Price of our Ai-95 is much higher and its quality is higher as well.—0—
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