OUTRAGED over allegations of profiteering, petrol station owners yesterday hinted at legal action and other steps – including possibly a warning strike.
The retailers were hitting back at Commerce Minister Antonis Paschalides, whom they accused of populism by seeking to turn them into scapegoats for the overall rising cost of living.
Paschalides drew the merchants’ ire last week when he said that 122 gas stations cheated customers by raising their prices, anticipating the surge in oil prices instead of responding to it when it actually happened. He said the retailers had bought fuel oil and petrol shipments at a lower cost and were selling them at a higher price taking advantage of the international hike in prices.
Yesterday, the minister said he had evidence of an additional 50 gas stations that sold older stock – purchased at lower prices – at the higher rates. These outlets, he said, had a small amount of fuel left from previous shipments which they then mixed with fresh stocks priced at the newer rates.
That brought the total number of retailers who were ‘exploiting’ consumers up to 170, out of the some 250 operating on the island.
Paschalides also pointed to collusion; he wondered how it was possible for nearly all the outlets to change their prices at the same time.
He also slammed gas stations for immediately marking up their rates, adding that whenever international prices go down they delay cutting their prices until old shipments run out.
Responding, the association of petrol station owners said they were free to change prices at any time, as there is no law obliging them to do so only once stocks run out.
“That’s how a free market works. And anyway, how does the minister know how much stock a gas station has? Did he peek into the tanks?” mused Pambinos Charalambous, the association’s honorary chairman.
Charalambous explained that retailers were notified by oil companies last Monday of the imminent price hikes; by Tuesday most stations had readjusted their rates, with the rest following on Wednesday.
Spartiatis Stathis, deputy chairman of the association, said retailers got a commission of around 3.5 per cent a result of an arrangement with suppliers – and that retailers had little to no say on this.
“This 3.5 to 4 per cent does not include costs which, if you deduct them, most of us are left with a profit margin of 1.5 per cent, barely.”
According to Stathis, retailers make an average profit of €45 per 1,000 liters sold.
“I sell about 5.5 million litres a year, which corresponds to revenues of €250,000. But then you have to subtract all the costs, salaries etc. At the end of the day, I only manage to make a profit because of the extras I offer, for example from the car wash.”
Last week, said Stathi, an average retailer made about €150 extra as a result of the latest price hike.
“You call that profiteering?” he remarked.
By contrast, the state collects €600 in various levies per 1,000 litres sold.
“If they really care about the consumer, why don’t they lower the tax?” asked Stathi.
And due to the mushrooming of gas stations, the profession was no longer viable, and a number of owners had sold their business.
Stathis went on to say that retailers might to be forced to lay off staff if Paschalides makes good on a proposal to introduce a cooperative of self-service outlets, which would presumably force current retailers to be more competitive.
After a meeting last night, Stathis told the Cyprus Mail: “We decided to go to the meeting with the commerce minister on Friday, not to apologise but to discuss the viability of petrol stations and the mediation of the ministry to the oil companies to secure wholesale prices for petrol stations to ensure their viability.
“At the same time, we will accept any proposal by the ministry, which guarantees the interests of citizens and consumers, and the viability of petrol stations.”
