Russia to pay 250–300 bln rbl to oil firms to keep 2019 prices

MOSCOW, Nov 28 (PRIME) -- The Russian government will pay 250–300 billion rubles to the oil companies in 2019 to restrain fuel price growth, Alexei Sazanov, director of the Finance Ministry’s department for tax and customs policy, told reporters on Thursday.

“We suppose that the mechanism is working normally. As we see, the price is not growing faster than inflation on the internal market, and we plan no changes at the moment,” he said.

“In total and taking into account that the oil price was higher than U.S. $60 (per barrel) for the major part of het year, the government’s payment would amount to about 250–300 billion rubles this year. This covers gasoline and diesel fuel in regards to the mechanism,” he said.

The mechanism restrains the growth of domestic fuel prices as the government compensates a part of the difference between export and domestic prices for gasoline and diesel fuel to the oil companies if export prices are higher than internal prices. If domestic prices are higher, the companies should transfer a part of excessive revenue to the government.

(63.9722 rubles – U.S. $1)

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