The dynamics of gasoline prices
A study of the dynamics of gasoline prices over the past three years indicates that the changes in retail gasoline prices in Armenia are completely in line with the dynamics of oil products imported into the country.
The average price of a liter of oil products imported into Armenia since 2013 corresponds to the average retail price of a liter of gasoline, i.e. the price of imported oil products declined as much as the price of retail gasoline.
According to data of National Statistical Service, in 2014, 129,009, 60 tons (171,582,768 liters) of vehicle gasoline was imported into Armenia (92-98 and higher octane gasoline) with a total cost of $122,875.8 thousand at the border. A simple logic shows that the average price of 1 liter at the border was about $0.72 or 297 drams. No data for 2015 has been released yet, which would make the picture clearer.
It is another question why the cost price of gasoline and diesel fuel in Armenia is so high. One should look for an answer in rules of the game of suppliers and domestic tax administration.
On the other hand, it is obvious that oil prices in international markets fall more rapidly than prices of oil products and gasoline imported into Armenia. The main reason is that oil purchased in a given period of time is supplied, processed and distributed months later. Therefore, a decline in oil prices is felt, for example, in Armenia a few months later.
Unfortunately, information provided by National Statistical Service and Customs Service does not contain data for shorter periods that would reflect price dynamics.
In comparison with European countries that have no oil resources, gasoline prices in Armenia are much lower, but one also should take into account the income levels of the population. As regards countries comparable with Armenia, gasoline prices in Armenia are higher than in Georgia (by 0.16 cents per liter) because of higher taxes and transportation costs. In Moldova gasoline prices are lower than in Armenia because of the depreciation of the national currency – the leu.
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