In this opinion n°A/3/22 on the surge in prices of inputs and raw materials at the global level and its consequences on the competitive functioning of national markets for fuels (diesel and gasoline), the Competition Council stresses that the structure and competitive functioning of these markets have remained virtually identical to those inherited from the time when prices were set by public authorities.
Indeed, the analysis conducted in this opinion has found that with the exception of the liberalization of sales prices, these markets continue to operate under the same administrative scheme of regulation, with the same legal and regulatory framework, the same stakeholders and almost the same mode of determination of sales prices and the same procedures, notes the same source.
This status quo could be explained by the level of financial profitability very high that this activity can generate and does not encourage operators to a competitive rivalry by the prices on these markets, as long as they are assured, or almost, the realization of positive results regardless of the situation or the number of operators. This explains, in large part, the absence of any exit of operators from these markets over the past ten years, notes the council.
And to add that these observations are confirmed by two aspects raised, namely the stagnation of the market shares with slight variations during the periods observed and the passive behaviors of the operators who neutralized any competition by the selling prices.
Moreover, and at the time of the decline in international prices in 2020 and the first half of 2021, it was found that these operators have preferred to increase their margins instead of seeking to increase their market share by making significant reductions in their selling prices.
Be the first to comment