Kazakhstan discussing new mechanism for regulation of petroleum products prices

ALMATY. April 17 (Interfax) - Kazakhstan's Antimonopoly Agency has published a Draft Order on Approval of Rules Providing Equal Access to Key Sources of Goods.

The document is published on the Open Online Legal Database for public discussion until April 28.

According to the explanatory note connected to the Draft Order, the agency made a competition assessment in the commodities market for the twelve months of 2021 and January-August 2022 and came to the conclusion that petroleum products manufacturing is a highly concentrated market, which means that a small number of producers operate in this market.

Furthermore, market players often complain that the wholesale organizations that occupy dominant or monopolistic positions in the market will not offer them products. To rectify the situation, the Antimonopoly Agency has developed rules to provide equal access to petroleum products for retailers.

According to the document, the key sources of petroleum products in the market, including gasoline, jet fuel and diesel, will now include the producers of these products, and the suppliers or importers of oil who have dominant or monopolistic positions in the market.

After these key sources of petroleum products are announced by the Agency, they will have to publish a contract for the sale and purchase of petroleum products separately for each type of petroleum product, including the price of the petroleum product for the next month exclusive of VAT, as well as the transportation costs and information about the procedure for accepting orders and providing access to their information systems.

Marat Omarov, the head of Kazkahstan's Agency for Competition Protection and Development, said this February that after the government, or specifically National Company KazMunayGas, had strengthened its position in the petroleum products market, especially after the acquisition of a stake in Petrosun, the efficiency of market regulation has only worsened.

Despite the new ownership of the main oil supplier, "the practice of purchasing oil from independent subsoil users at low prices still continues, which threatens 20% of the private market," the Antimonopoly Agency said earlier in a statement.