site.btaUPDATED Government Has Not Yet Decided Whether to Lift Ban on Fuel Produced from Russian Oil - PM
The government has not yet adopted a decisions to lift the ban on the export of fuels produced from Russian oil, Prime Minister Galab Donev said here Friday. He was speaking during Question Time in Parliament where he was asked by Martin Dimitrov MP (Democratic Bulgaria) about the government’s controversial plan about lifting the ban.
"We are yet to assess whether this ban will lead to a decrease in fuel prices or to an increase. It is not only gasoline and diesel that is produced from crude oil: many other products come from the technological process of refining, which need space to be stored. Here is a question for you: when the [Lukoil] refinery is overfilled with raw materials that they have nowhere to sell, what effect will this have on the domestic market?" said Donev.
"There is no analysis yet of how a possible lifting of the fuel export ban would affect prices," the Prime Minister said.
Energy Minister: Continued ban on export of Lukoil fuel will drive prices up, cause social problems
Taking his turn to answer MPs questions during Question Time on Friday, Energy Minister Rossen Hristov largely reiterated what the Prime Minister said, about Lukoil producing more than fuels and what risks there is for the refinery to stop working because there will be no place to store all products (some of which cannot be used in Bulgaria and the EU because of the environmental restrictions).
Hristov also said: "In normal circumstances, the output of the Burgas refinery significantly exceeds consumption in Bulgaria. If exports are curtailed, this overproduction cannot be handled and the refinery's capacity will have to be reduced. The cost of petroleum products includes a fixed and a variable part. It is therefore natural to expect an increase in the final price. You can imagine what social problems will arise in the event of downsizing production or a possible shutdown: loss of thousands of jobs and the loss of potential revenue throughout the region, including for subcontractors."
The ban on the export of fuel produced by the Lukoil refinery in Burgas was imposed by the Kiril Petkov government in keeping with the EU ban on the import and export of Russian oil and on the insurance for such cargo in maritime shipping.
Bulgaria is still able to use Russian crude oil thanks to a derogation allowed by the EU on account of its geographic location and dependence on Russian oil.
In late October, it transpired that the caretaker government plans to scrap the ban on the export of fuel produced by Lukoil from Russian crude. The European Commission reacted to the plans, saying that the exemption for Bulgaria, valid until the end of 2024, aims to allow this country to supply itself with oil, and not resell it to other EU Member States or third countries.