Fuel prices in Spain remain unstoppable. Both petrol 95 and diesel have prices in most gas stations above two euros per liter. And the escalation seems unstoppable, as predicted by the president of the Spanish Confederation of Petrol Station Employers (CEEES), Nacho Rabadán, who expects to overcome the psychological barrier of three euros per liter this summer.
“I don’t rule out any scenario, we could see prices of 3 euros/litre this summer,” admits Rabadán, explaining that refineries have maximized their diesel production because demand far exceeds supply and their refining margin when processing diesel is very high. is. The problem is exacerbated as now summer comes in the Northern Hemisphere “and with it an increase in the demand for gasoline and there isn’t enough.” In practice, this means that filling the tank of a car with a capacity of 55 liters costs about 165 euros «so for a vehicle with a consumption of 7 liters per 100, traveling 20,000 km per year will cost about 4,200 euros, 350 euros per month.
All service stations owned by SMEs (69.5% of the 11,650 service stations registered by the Ministry of Ecological Transition and Demographic Challenge) are in an extremely difficult situation due to high prices. The decline in demand and the application of the 20 cent bonus introduced by the administration are two of the causes that have pushed these establishments against the ropes. Compared to 2019, 492 companies in the sector have disappeared and 1,516 jobs have been destroyed, according to figures from the Spanish Confederation of Employers of Gas Stations CEEES.
The president, Nacho Rabadán, explains that closures are usually not due to a single reason, but rather a series of cumulative circumstances that ultimately lead to the closure of the company. “We think the situation for the sector is far from ideal. During the early months of the pandemic, we were forced to stay open with the same hours we had, despite the fact that mobility dropped by 90%. Some employees even had trouble closing the shifts because the computer system detected an error as they recorded $0 worth of sales during the shift. That’s where we come from and the passage of time has only exacerbated the already complicated situation of gas stations.
For consumers, it continues to appear a contradictory situation, as with prices breaking records week after week, it is contradictory that gas stations are going through a deep crisis. Part of the blame lies with the government-imposed bonus of 20 cents per litre, which, although relatively limiting the price increase for consumers, is suffocating the operators of the gas stations.
According to the latest data from the Ministry of Finance, the administration has already paid 333.6 million euros in refunds of the applied bonuses, which corresponds to just over 84% of the applications submitted. In other words, 16% of the requests went unanswered. And the worst thing, according to Rabadán, is that according to the literal wording of Royal Decree Rd-L 6/2022 that regulates this measure «the administration would be within the deadline, even if it paid us on June 15 the bonuses that are due in April and until July 15 to repay the amounts advanced during the month of May ». Since the refunds depend on the special delegations of the tax authorities’ special taxes, there are some areas where “applications are processed much more quickly than in others, creating inequalities and competitive disadvantages between service stations based on the autonomous community in which they are are.
The measure has caused a “book” of financial strangulation among the thousands of SMEs that make up the sector. Some, according to data from CEEES, manage to survive “thanks to the lines of credit they have signed with their respective financial institutions.” Others have complied with the agreement between this association of undertakings and EBN Banco and will in any case be faced with financial costs “which they would not have had if the measure had not entered into force”.
Nacho Rabadán explains that suppliers are aware of the liquidity problems that petrol stations face and, in some cases, ask for prepayments for tankers when they supply us with fuel. “When liquidity problems start, it’s like a domino falling, they usually never come alone and go in a chain. And having to advance an average of 1,000 euros per day (33,000 euros per month) drains the liquidity of any SME, regardless of the sector in which he is active.
At the same time, the OCU Consumer Organization has denounced that the cut of 20 cents per liter of fuel has not stopped the ongoing price trend, advocating the need for more drastic measures, such as the temporary abolition of taxes.
One of the most common consumer concerns is why the price of fuel does not fluctuate in the same proportion as the price of Brent oil. As explained by the Spanish Association of Petroleum Products Operators AOP, the price in Spain is not directly related to the price of a barrel of oil.
The final price depends on the prices of petrol and diesel in the reference wholesale markets (Mediterranean and Northern Europe in the Spanish case). Since these markets are traded in dollars, the euro/dollar exchange rate is also an important factor.
There are costs that practically do not vary, including production, distribution and marketing costs, including wholesale and retail margins.
The price is also influenced by taxes and other associated costs, such as the maintenance of strategic reserves and the contribution to the National Energy Efficiency Fund.
In Spain, liquid petroleum fuels are taxed with two taxes: VAT of 21% and the Special Tax on Hydrocarbons (IEH). in this case, the general state tax rate (TEG) for petrol is 95 €400.69/1,000 liters, and €307/1,000 liters for diesel A. With the special state tax rate (TEE), the state collects an additional 72 euros for every 1,000 liters of petrol 95 and diesel A (figures as of March 2022 provided by AOPP).
Source: La Verdad
I am Ida Scott, a journalist and content author with a passion for uncovering the truth. I have been writing professionally for Today Times Live since 2020 and specialize in political news. My career began when I was just 17; I had already developed a knack for research and an eye for detail which made me stand out from my peers.
