OUR VIEW: Meeting over petrol pricing simply a gas

IT WAS all sweetness and light after the meeting between Commerce Minister Antonis Paschalides and the petrol station owners yesterday. The accusations of profiteering and greed made against the station owners by Paschalides last week, were forgotten as the two sides agreed to set up a technical committee that would determine increases and decreases in the price of petrol.

The technical committee, consisting of a representative of the petrol companies, station owners and ministry, would devise a formula that would decide how much prices would rise or fall when there was a change in the price of crude oil. This looked suspiciously like price-fixing, but Paschalides was quick to point out after the meeting that “the aim of everyone must be the existence of healthy competition, the free economy and protection of the consumer”.

Having suppliers sitting together with a government representative and deciding by how much the price of their product would increase does not seem anything like ‘healthy competition’. It looks a lot more like price collusion blessed by the state even if the new price is determined by a formula. Paschalides was very pleased with the agreement as controlling petrol prices had always been a pet cause of his.

Last year, he imposed a ceiling price on petrol prices, which was lifted a few days later because of threats that the petrol stations would be closed in protest. Last week, after petrol prices rose before the more expensive shipment of petrol had arrived, he attacked the station owners of profiteering and threatened to set up a co-operative of self-service petrol outlets to compete with the existing stations.

Hopefully, the price-fixing formula, that might save the consumer a euro on a tank of petrol, when world oil prices rise, will allow the minister to stop obsessing about pump prices and concentrate on more substantive ways of protecting the consumer.

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