11/08/2004 00:00
TW
0

by Staff Reporter
JESUS Salas, chairman of the Balearic Petrol Station Owners Association, predicted that petrol prices would go up at the end of this week if the price of crude oil continues to rise. He also predicted that petrol could be between five and ten percent dearer in the Balearics within the space of one or two months.

Salas said that the petrol companies which supply the Balearics have been containing prices for the past two weeks, but he warned that if the price of a barrel of oil, which on Tuesday was $41.65, is not maintained, the cost of petrol would go up and this increase would be passed on to consumers from next weekend.

He added that the new maximum price of crude oil had already had repercussions on petrol users, pointing out that it had gone up by .002 cents in the Balearics on Tuesday, to 0.783 euros, which was .001 higher than the national average.

At the same time, he said that the cost of unleaded petrol in the Balearics is 0.908 euros, .001 below the national average.
Salas explained that the current situation is “uncomfortable” and unsettling for businesses which receive a fixed commission independent of the price of the product, as their profit margin is calculated per litre sold.

As to users, he commented that the increase in petrol also hit users in the pocket.
Finally, he said that it was “sad” that there were regions which added more taxes on crude oil (some communities add a small tax to help fund the health service), and criticised the increase in this type of tax.

Similar predictions about a ten percent increase in petrol prices over the next two months were made by service station owners and the companies which supply petrol and diesel.

Sources said that the increase in price in oil and its derivities has been caused by the tension generated on the international market by diverse factors.

They included the interruption of supply in Iraq, political instability in Venezuela, strikes in Nigeria and the situation of the Russian petrol company Yukos.

The same sources said that diesel would be hit in mid-September, when most countries prepare for winter.
This usually pushes up the price at the end of every year, but this year it is expected to go up more than usual.
A spokesman for the sector said that it was unusual for so many adverse circumstances to hit the petrol market all at once, and they hoped that some of the conditions would ease.

Any increase in petrol prices will lead to a chain reaction in the cost of goods and services.