Rising gasoline prices increase the risk of price gouging

BarcelonaThe National Markets and Competition Commission (CNMC) will monitor fuel prices at gas stations to prevent abuses and disproportionate price increases amid the ongoing conflict in the Middle East. Vice President Sara Aagesen announced this. The NewspaperShe sent a letter to the supervisory body entrusting it with this task. "It is important that the supervisory body be very vigilant so that consumers do not suffer any undesirable impact, beyond that caused by the energy markets themselves," noted the Minister for Ecological Transition. The US and Israeli attack on Iran and Tehran's retaliatory measures have caused a surge in the price of crude oil, which recently reached $117.

In fact, several organizations have already warned of potential abuses by gas stations. The Secretary General of FACUA-Consumers in Action, Rubén Sánchez, denounced at a press conference a "speculative trend" at many gas stations, with "an exorbitant increase in fuel prices that doesn't actually reflect the rise in oil prices." "It's not proportional. In fact, the fuel being sold at gas stations isn't what's being sold now in this situation. Some gas stations are arguing that they're getting ahead of what will happen with the new stock they'll receive, but really, as always, there's a rocket effect and a feather effect," he said. This means that when oil becomes more expensive, fuel prices rise rapidly, while when crude oil becomes cheaper, fuel prices fall slowly.

For its part, the Consumers and Users Organization (OCU) has requested an "urgent reduction" from the Spanish government in the VAT on fuels or the special tax on hydrocarbons, which together represent 50% of the final price. Furthermore, the organization insisted that service stations are selling "fuel refined with oil acquired at prices far below current levels," and therefore the organization believes it is necessary to "strengthen market oversight" and "guarantee that no unjustified price increases occur."

The National Federation of Transport Associations of Spain (Fenadismer) has also demanded that the Spanish government carry out inspections at gas stations to prevent what it believes are abuses related to fuel price increases. The employers' association is calling for Spain to follow France's example, where Prime Minister Sébastien Lecornu has already announced the start of 500 strategic inspections at gas stations across the country "to curb any attempt at price gouging or unjustified profit margins." "It is unacceptable that the conflict in the Middle East should translate, in less than a week, into price increases of up to 30 cents per liter at Spanish pumps. A rocket effect is occurring," and SMEs "cannot pass these costs on instantly" to their products. The rocket effect

The "rocket effect," that is, the rapid rise in fuel prices due to the increase in oil costs, is clearly visible in the data from the Ministry for Ecological Transition. The average price of a liter of 95-octane gasoline in Catalonia on February 28, when the price war began, was €1.486, while by Monday it had risen to €1.654. ​​This is even more evident in the case of diesel (the standard automotive diesel), which cost €1.433 per liter on February 28 and had risen to €1.750 by Monday. In fact, the president of the Catalan Association of Service Station Associations, Albert Campabadal, acknowledged this "rocket effect" in an interview on RAC1. Thus, he admitted that prices have skyrocketed and even predicts that a liter will exceed 2 euros, although current fuels were refined with oil purchased at a much cheaper price than today's, since wholesalers must maintain a stock equivalent to 92 days' consumption as a strategic reserve. "Prices rise very quickly, but then we're a bit reluctant to lower them," he acknowledged, although he added that "the market regulates itself very well." However, he asked that if the Spanish government takes measures to benefit consumers, it should not be a subsidy of 20 cents per liter like during the war in Ukraine, but rather a reduction in VAT (from 21% to 10%, he pointed out) or in the hydrocarbon tax.