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Situation on the fuel market. Hungarian script. Sławomir Dudek comments

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This is what Orlen’s president, Daniel Obajtek, talked about, referring to the Hungarian scenario. And his company did it anyway – notes Sławomir Dudek, president and founder of the Institute of Public Finance, in an interview with TVN24 Biznes, when asked about the current situation on the fuel market. As he reminds, fuel price limits were introduced in Hungary, and then the government was forced to abolish them. -There is a shortage of fuel at stations, just like today in Poland – adds the economist.

Still at the beginning of 2023 Daniel Obajtekthe head of Orlen, argued that the company cannot reduce prices fuel pricesbecause what happened would happen Hungarywhere the government introduced and then suddenly abandoned the setting of a maximum price for a liter of gasoline and diesel oil.

– You heard a few months ago that fuels should be regulated and cost PLN 5 per liter. If we regulated prices, there would be no imports to Poland. I gave the example of the Hungarian economy and I was not wrong. That’s what happened there. Manual control led to fuel shortages, said the head of the state-controlled giant.

Read also: “Failures” at dispensers. This is what Orlen told the stations to write

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In mid-November 2021, before the parliamentary elections, Hungary introduced a fuel price cap – 95-octane gasoline and diesel fuel could not cost more than 480 forints (then approximately PLN 6.05) per liter. Then, in subsequent steps, the group of drivers who could refuel at lower prices was narrowed down.

Finally, in December 2022, half a year after Victor Orban won the elections, The Hungarian government has abolished the fuel price cap. This happened at the request of the Hungarian company MOL, after panic buying and problems with imports led to fuel shortages throughout the country. The energy company indicated that there was a “critical situation” on the domestic fuel market. Immediately after the limit was lifted, fuel prices increased significantly.

Diesel prices increased by one third

Sławomir Dudek, president and founder of the Institute of Public Finance and former director of the Department of Macroeconomic Policy at the Ministry of Finance, in an interview with TVN24 Biznes, reminds that in Hungary the government has frozen the prices of many products, including fuels.

– There were no people even willing to sell products at such low prices. There was a shortage of fuel at stations, just like today in Poland. A few months before the elections, prices were stable, low and government-controlled, and after the elections the government could not afford to freeze prices. The economy was deregulated, with a black market, buying up goods and stockpiling. After the elections diesel prices increased by one third, gasoline by 24 percent, and electricity prices even by 65 percent – he calculates.

In his opinion, this scenario is real in Poland. – Looking at the fuel market and what analysts and global companies operating in the fuel market say, which warn that something unnatural is happening to prices, this scenario is identical. We already have signs with a “dispenser failure”, there is a shortage of fuel – he points out.

As he adds, “Orlen, as a monopoly, decides about the market and artificially lowers prices.” – After the elections, prices will skyrocket. Prices are reduced by 20 to 30 percent. If today diesel oil costs about PLN 6.20, after the elections it may cost about PLN 8.40 – says the economist.

Read also: Ambulance problems with refueling. “Rescuers were driving around looking for fuel”

“We will find out everything after the elections”

Sławomir Dudek points out that there are more similarities to the Hungarian scenario. – In Poland we have frozen VAT on food. The next thing is to centrally control the prices of state-owned companies that provide some universal services. After all, there was a case with the railway which, based on economic calculations, increased ticket prices, and the Prime Minister ordered to withdraw this increase. It’s the same with highways. We know this, but the question is, how many things do we not know? – says.

He states that “the Hungarian scenario teaches us that it is impossible to stop the flow of a river.” – Inflation processes are strong and cannot be stopped by central control. This was done in the Polish People’s Republic and it ended tragically. Price control is temporary, it is a fraud, we live in a virtual world of inflation. To be honest, I don’t know what real inflation is. We will find out everything after the elections – explains Sławomir Dudek.

In his opinion, “these actions should be taken care of by the Office of Competition and Consumer Protection and the Energy Regulatory Office, but they are keeping quiet.”

– Orlen, as a monopolist on the market, is destroying small gas stations because it keeps the price of fuel low by force, while imports are 20 or 30 percent more expensive – he notes. – Such control creates a speculation market, people stock up. What will happen at gas stations when people find out that petrol discounts are over and that prices are returning to market levels? There will be Armageddon, he adds.

Read also: “I see our local politician suspiciously filling barrels with fuel.” A PiS MP caught at a gas station

Fuel battles

He adds that this happened in Hungary when information about the end of low prices leaked. – People stood in lines all weekend and there were fights, battles for fuel – he reminds.

– This is a strong deregulation of processes, speculation, scams, and this is what Daniel Obajtek talked about, referring to the Hungarian scenario. And his company did it anyway. There will be great consequences of this, because the lack of competition in the fuel market will soon destroy other industries. The entire economy is disrupted because fuel is a key product, says Sławomir Dudek.

– This is a huge hit to the functioning of the economy – he adds.

Read also: Economist on Kaczyński’s words. “I would say it’s exactly the opposite.”

Main photo source: tvnwarszawa.pl/ Artur Węgrzynowicz

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