The price of Eurodiesel at Montenegrin gas stations from Tuesday could be about 11 cents higher and will amount to 1.68 euros, while the prices of two types of gasoline will most likely increase by about three cents, so Eurosuper 98 will cost about 1.59 euros, and Super 95 about 1.55 euros. Heating oil will probably increase by 11 cents, so its price will amount to 1.83 euros per liter.
This is shown by preliminary data on the prices of petroleum products on the international stock exchange and the dollar-euro exchange rate.
The Ministry of Energy and Mining will announce new maximum retail prices on Monday, which will be valid for the next seven days.
This will be the third consecutive increase in fuel prices since the outbreak of the new war in the Middle East a month ago. Last week, the government reduced fuel excise duties by 50 percent on diesel and by 25 percent on two types of gasoline, and also changed the regulation to align prices in Montenegro with the stock exchange every week, instead of once every 14 days as before. The reduced excise duties, according to this decision, will be valid until April 21, but the government can extend them by a new one.
Despite the reduction in excise duties, the retail price of diesel, with the new adjustment, will increase from 1.34 to 1.68 euros for the month. If there had been no excise duty reduction, diesel would have cost around 1.93 euros as of Tuesday. By increasing prices by 34 cents, the state gained seven cents more through VAT, while it lost 22 cents per liter through the excise duty reduction.
Gasoline prices since the beginning of the crisis, despite the reduction in excise duties, will be 15 cents higher. If excise duties had not been reduced, these two types of fuel would have been about 16 cents more expensive.
Heating oil is the only energy product with a regulated price for which the excise tax has not been reduced, so its price will be increased from 1.27 to 1.83 euros since the outbreak of the crisis.
The crude oil market recorded its highest daily average price of $111 per barrel since the outbreak of the crisis yesterday, with continued growth, while the previous highest daily average since the beginning of the crisis was $106.4 per barrel on March 20.
Since the start of the new war, crude oil prices have risen by 54 percent. Prices fluctuate by as much as 10 percent daily, due to statements by politicians and warlords regarding negotiations on the terms of an end to the war or the future use of the Strait of Hormuz, as well as the actual events of the war if one of the sides strikes oil infrastructure.
A similar situation is occurring on the oil derivatives exchanges, with their prices usually rising more slowly than crude oil. A more significant increase has been recorded in the past two days compared to the previous period.
The transition to seven-day harmonisation of retail prices with stock exchange prices means that fuel prices in Montenegro will more quickly follow stock exchange prices, both in cases of current growth and if prices fall internationally.
With the new expected price increase from Tuesday, Montenegro will move closer to fuel prices in the region. In Serbia, the price of Eurodiesel was 1.80 euros yesterday, and gasoline was 1.60.
In BiH, where fuel prices are freely set and depend on the location, or entity, the average price of diesel was around 1.73 euros yesterday, and gasoline around 1.45 euros.
As response measures, the remaining amendments to the excise and VAT laws
The Law on Excise Duties allows the Government to temporarily lower excise duties on fuel by up to 50 percent, which has been used to the maximum extent for Eurodiesel, while there is still room for a possible reduction of another 25 percent in the excise duty amount for gasoline.
In the event of continued growth in fuel prices on international stock exchanges, the preservation of lower domestic prices could only be addressed if the Parliament were to amend the laws on excise duties and/or value added tax (VAT).
The full excise duty on Eurodiesel is 44 cents and for gasoline 54.9 cents per liter, which are included in the VAT calculation. This fuel tax is at a higher rate of 21 percent. Lower VAT rates that exist in the law and apply to some other goods and services are 15 and 7 percent.
Croatia and Serbia have partially and temporarily lowered excise taxes, while North Macedonia has lowered the VAT rate on fuel.
Montenegro has so-called strategic reserves of around 44 thousand metric tons, which were formed by private companies while the state did not form reserves in its own ownership. The Ministry of Energy and the Government have repeatedly reiterated that the state can use these strategic reserves (owned by private companies) only in cases of general shortages of derivatives or complete supply disruptions, and that they cannot be used to reduce prices on the domestic market.
