Maltanews

Malta

Malta Fuel Prices

How convenient it has been for Governments to blame everything under the sun as an excuse to justify passing most of the increases of Oil price increase onto the Consumer. I will try to use logic on how much truth there is in Government arguments. Lets start with fuel prices in Europe

Facts:

Average prices 2007

——–Unleaded 95 ——–Diesel———–

Country….. Before Tax ….After Tax ….Before Tax ….After Tax

France ……0.46/liter …… 1.27/liter …0.49/liter ……1.09/liter

Britain ……0.46/liter …….1.38/liter …0.49/liter ……1.42/liter

Germany..0.47/liter …….1.34/liter …0.50/liter ……1.16/liter

Belgium …0.49/liter …….1.32/liter ….0.52/liter …..1.03/liter

Spain …….0.50/liter …….1.05/liter ….0.52/liter …..0.97/liter

Luxembourg 0.51/Liter ….1.12/liter …..0.52/liter …..0.93/liter

Now this table above was just an average price for 2007 let alone the average price in 2008 where the price of oil has gone up by 40% in the first quarter compared to 2007.

Download the following pdf’s for detailed analysis:

International Agency Statistics:

http://www.iea.org/Textbase/stats/surveys/oilsurv.pdf

The AA Statistics for May:

http://www.theaa.com/onlinenews/allaboutcars/fuel/2008/may2008.pdf

European Automobile association:

http://www.acea.be/images/uploads/files/20080327_ACEA_Tax_Guide_2008_Introduction.pdf

Euro stat:

http://ec.europa.eu/energy/energy_policy/doc/factsheets/market/market_mt_en.pdf

Malta : It’s such a transparent and Democratic Country, that the answer about the real cost before and after tax is the million dollar question and disguised as ‘Commercial’ secret. No answer was found in the official Malta Government website as to cost and tax related to fuel in Malta.

The truth is that the price to consumers is inflated not only due the speculative price in the oil market, but also by the incremental and detrimental effect that indirect taxes have on the price/liter of fuel. So that the higher the price = higher tax revenue to each respective Government.

Another fact that is hardly put into practice by European Governments is that Oil in the market is quoted in the US dollar. In effect the US dollar exchange rate has been dwindling against most currencies, and this has been substantial against the Euro and other European currencies.

Another truth is that conservation in energy by most Governments is only taken at face value. Investment in effective means of cheaper mass transport has been lacking and unreliable. This holds true in the case of Malta, in that the Public transport system is more comparable to a third world country than to a European one, albeit the cost to consumer for licensing and other costs on transport upkeep has been going up year on year.

Other (Malta) Government induced costs imposed on the import of cars from Europe, i.e.: Import Tax and VAT are prohibitively high, there-by making it next to impossible for more efficient cars to be bought by consumers that want to change to a more modern fuel efficient and environmentally friendlier car. Obvious benefits in changing this tax regime is multi fold, including health, environment and costs. But unfortunately the Malta Government’s way of thinking has always been to cheat citizens out of their money, even though the EU warned the Malta Government that the tax system imposed on car imports form EU countries is in essence against EU policies in its form and will consider taking the Government to the European Court of Justice, the Government just ignored the EU and knowing that the EU takes a long time to get a Country to the Courts, mean while the tax is collected illegally from citizens, till the EU actually does exactly what it is supposed to do, namely to protect consumers.

Malta’s inefficient management of the fuel supply to the Maltese consumer should be seriously reviewed. The only argument that is given to the consumer is ‘Oil price increase is from outside influence’, the truth is that management of this commodity has never been taken seriously and managed by armatures. The reasons for this are:

  • No serious incentives and tentative are made in exploration/exploitation of oil in the Maltese territorial commercial zones, albeit oil has been found and exploited commercially from  oilfields in Sicily (Vega & Gela),Numerous Tunisian Oilfields, Libyan Oilfields with a massive platform that has been producing over 20 years in Bouri field.
  • Government and Enemalta have not sought to consider starting a new Company that has the sole purpose to seek partnerships in acreage drilling/producing oil, if need be involving public investment, to secure future supplies of oil. Most oil exploration in today’s oil mining industry tends to share risk by adding partners in both exploration and development of oilfields. That is how most of the big Oil majors started i.e.: BP, Shell, Statoil, Petrobras etc and smaller Companies share risk by buying into acreage and either farm out their concession to bigger Companies while retaining a share holding in their acreage, minimizing their costs and efficiently evaluate the acreage for any prospects. They undertake oil exploration and production not only in their territorial jurisdiction but also overseas and other viable areas where their risk is minimized. It has to take more commitment than staying in the comfort of an air conditioned office but rather rolling up ones sleeves and set off to work.
  • Securing alternative energy generation, Solar and/or Wind. Thought might be given to any viable underground geothermal energy that might be exploited. Exploitation of energy from waste.
  • Investment in an efficient Public transport system, eliminating inefficient buses, considering opening up to taxi service/mini bus Companies providing group travel between cities and industrial areas and cities to shopping areas.
  • Expanding the electric car transport from the Capital to other highly populated areas.
  • Investment in mechanical and electrical research for efficient use of energy, both to University students and private enterprise.
  • Research in possible connection to European energy grids.
  • Eliminating Electricity and water lost to inefficient systems and lost to seepage.
  • Monitoring of off hours Governmental and Public/Private Companies use of energy, punishing waste of energy with higher rates and incentives given to those that invest in economical use of energy.
  • Incentivizing Local Councils to device plans for introducing alternative use of energy in their locality, including solar powered street lighting.
  • Encourage citizens and employees to bring forward energy cost saving ideas to the Government, Public entities and Employers.

I think that there is lack of leadership and responsible management for a harmonized and fair partnership between citizens and Governments. Consumers don’t complain just for the sake of complaining, consumer complaints should stimulate those managing anything from Government to Companies to perform better and create customer satisfaction, instead of feeling cheated with next to no value for money. If companies are expected to perform and be innovative in their thinking, so should Governments be. Companies are expected to create wealth and expansion of investments trusted in them, well beyond a Company’s CEO term as head of the Company. So should Governments frame of thinking, well beyond their term in office.

So in the meantime, let’s blame it all on the Oil producing Countries and the Oil Companies (that take most of the risk and capital investment), and on consumption of development in China, India and other Countries while our Governments reap the benefits and point their fingers in the wrong direction. But if Governments are so unscrupulous in making profit off their citizens why citizens shouldn’t be unscrupulous in investing their money in Oil Companies to take back what has been taken from them? Thank God it’s a free market economy, where gloves are off and chaos rules

European Oil Prices

 

June 4, 2008 - Posted by | Malta | , , , ,

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