Bečarević: Gas will become cheaper in the world, only in BiH it will not

Global trends in the prices of oil and natural gas indicate only one thing, and that is that prices are falling and that the decline is drastic. Prices of oil and natural gas on the domestic market do not follow these trends, said Almir Bečarević, long-time director of BH Gas, writes the Bosnian news agency Patria.

Prices on the oil and oil derivatives market in 2009 were in the following ratio:

At the beginning of 2009, a liter of fuel in BiH cost 1.05 KM, while on the world market oil cost between 37 and 44 dollars.

At the end of 2009, the price on the domestic market was 1.28 KM, and the price of oil on the world market ranged from 69 to 79 US dollars.

At the beginning of 2010, the price of oil was 1.63 KM, and the price of oil on the world market ranged from 71 to 82 US dollars.

Fuel prices on the domestic market at the end of 2014 amount to approximately 2.0 KM, while oil prices on the world market currently range from 65 to 78 US dollars.

Bečarević is of the opinion that the given price overview clearly shows that there is room and possibility for further price decline on the BiH market.

- Factually, it is difficult to claim that these oil prices on the world market will remain in the long term, but the logical question arises as to why these current trends are not consistently followed and the already difficult life eased. I leave it to every reader of this data to assess for themselves whether it is justified to demand that fuel prices be reduced - said Bečarević.

He also reminded that the dollar exchange rate was in approximate amounts and its influence could have affected a maximum of 10% plus or minus, but that this could not drastically change the price ratio.

He further states that gas prices on the market are formed based on oil and oil derivatives and based on the average over the past 9 months, which means that a drastic drop in gas prices is expected in the coming year.

- I want to remind that the price of gas in the past, just over 2 years, from 530 USD per 1000 Sm3 (which is a historical maximum) has been reduced to approximately 375 USD per 1000 Sm3 - said Bečarević.

The current price to Ukraine is 378 USD per 1000 Sm3, which corresponds to the current price to Europe, which averages approximately 370 USD.

- This price has a further downward trend and will, at the end of the first half of 2015, amount to about 300 USD per 1000 Sm3, and according to the current oil price, it is expected to maintain this trend in the second half of 2015 as well, meaning a continued decrease - said Bečarević.

Comparative analysis of gas prices:

At the end of 2009 and beginning of 2010, the price of gas on the domestic market was 520 KM per 1000 Sm3. The price of gas from Russia in that period was approximately 300 USD, which converted to approximately 430 KM per 1000 Sm3.

The price of gas on the domestic market from April 2010 was 650 KM per 1000 Sm3, while the price of gas from Russia had an upward trend and amounted to up to 400 USD per 1000 Sm3, which converted to 580 KM per 1000 Sm3.

The maximum price on the domestic market from November 2011 was 820 KM, and the maximum price of Russian gas from that period was 530 USD (converted 780 KM) per 1000 Sm3.

The current price of gas on the domestic market is 754 KM per 1000 Sm3, while the price of gas from Russia is approximately 375 USD per 1000 Sm3, which converted amounts to approximately 590 KM per 1000 Sm3.

Bečarević says there are no indications that the price of gas on the domestic market will be reduced, even though the price of gas from Russia in 2015 will amount to 460 KM per 1000 Sm3.

- The given overview, as with oil prices on the world market and domestic fuel, shows illogicalities, i.e., fuel and gas prices on the domestic market do not reflect the drastic drop of these energy sources on the world market. Lower prices will contribute to a drop in other prices, for which these types of fuel are a calculative element, as well as to improving the standard of citizens, especially in the winter period when gas is primarily used for heating - concluded Bečarević.