The Ministry of Energy will raise the price of fuel and lubricants.

The head of the ministry called this unpopular measure forced and necessary to stabilize the domestic market and prevent a shortage of fuel, World of NAN reports referring to Agroqogam.kz.

Minister of Energy Bolat Akchulakov today at a briefing at the SCC suggested raising the cap prices for gasoline and diesel fuel.

"In order to stabilize the domestic market of fuels and lubricants it is necessary to reduce the price difference between Kazakhstan and neighboring countries. Therefore, we must take a difficult, but at the same time necessary step - to increase the marginal retail prices," Akchulakov said.

In his opinion, it is necessary to raise the price of gasoline AI-92 and AI-93 from 182-187 (depending on the region) to 205 tenge per liter (11% growth), diesel fuel - to 295 tenge per liter (an average increase of 20%).

"The corresponding draft order will be published today. If we do not reduce the difference in prices now, then in the near future we will face a total shortage of fuel. Moreover, this will block the way for further development of the industry and threaten the energy security of the country," warned the head of the Ministry of Energy.

The situation with fuel and lubricants in neighboring countries, he continued, has a significant impact on the domestic market of Kazakhstan.

"For example, in March last year retail prices for diesel fuel in the Russian Federation dropped to the level of the Republic of Kazakhstan. As a result, sales of fuel at gas stations bordering Russia significantly decreased, because there was no interest in exporting fuel and lubricants from Kazakhstan. But literally a month later there was a sharp increase in retail prices in neighboring countries, and as a consequence, in the autumn, despite the increase in the production of diesel fuel, we again faced an acute shortage of fuel", - said Akchulakov, adding that this year the disparity in prices remains.

In March, the growth of consumption compared to the same period last year increased by 15%.

"In such a situation, Kazakh diesel will definitely flow out to other countries in even larger volumes. Already this year we may face a deficit of up to 850 thousand tons. If earlier the deficit was partially covered by increasing production, now our refineries are working at the limit of their capacities. In the next 6 years, it is physically impossible to significantly increase the production of diesel fuel until the expansion of the Shymkent refinery. Thus, Kazakhstan with its cheap fuel actually subsidizes the economy of other countries to the detriment of their own national interests," the Minister stressed.

Akchulakov reminded that after modernization of three Kazakhstani oil refineries (Atyrau Refinery, Pavlodar Petrochemical Plant and Shymkent PetroKazakhstan Oil Products LLP) their production capacity increased by 3 million tons and reached almost 17 million tons per year.

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