Car owners are worried about rising gas prices. In 2019, the cost, according to experts, can grow to record levels. Drivers are interested in what caused this phenomenon, which makes up the cost of gasoline. In order to delve deeper into the essence of the problem, you need to consider what the price tag for automobile fuel is composed of, what features this process is accompanied by. An example of costing and explanations of experts will be discussed later.
Market situation
The cost of gasoline in Russia is formed under the influence of many factors. Price increases have been observed over the past 20 years. Domestic drivers have already become accustomed to this circumstance. But this year, even the country's oil companies were able to shock them. The increase in gas costs increased so much that even pedestrians felt it. Travel for them in public transport has also risen in price.
It should be noted that over the past 20 years, the cost of gasoline has grown significantly. But the cost of fuel production remained the same. The development of the oil production market has led to a rise in price of a barrel from $ 12 in 1998 to $ 135 today. This is due to the growth, development of the market.
To calculate the cost of gasoline in Russia, you need to delve into all the intricacies of this process. Many of our compatriots are surprised why in a country where oil is extracted, gasoline for the population is sold at market value. So, for example, in the UAE, Venezuela, the cost of fuel did not increase in the domestic market.
Of course, the cost of Russian gasoline remains the lowest in Europe. But this does not interfere with maintaining the price of fuel in the country at the market level. Our country is fundamentally different from that of Venezuela, where at the beginning of 2018 the cost of a liter of gasoline was 0.02 dollars. In modern Russian realities, this seems to be fiction. How is the cost price calculated? Why is the cost of gasoline in some countries ten times less than in Russia? This issue needs to be addressed in more detail.
Cost components
How is the cost of 1 liter of gasoline calculated in Russia? It is necessary to consider this procedure in detail.
So everyone knows that gasoline is made from oil. For this, 2 methods are used:
- direct distillation;
- cracking (catalytic or thermal).
To extract oil, you need to find its field, to conduct geological explorations. Only after that drilling is carried out. Then, the extracted mineral is transported to the plant where it is processed. Next, the finished gasoline is transported to gas stations.
The company that manufactured the fuel must pay a number of taxes and excises. This also affects the cost per liter of gasoline. To derive the cost of a liter of gasoline, you need to specify the entire chain of production costs:
1 liter of gasoline = cost of geological exploration + transportation + processing + retail costs + income tax + excise tax + VAT + mineral extraction tax + total profit.
Each item needs to be said in more detail. Geological exploration is carried out in our country in the northern regions. It has been cold here for most of the year. Also in such areas there is no developed infrastructure. In order to produce oil here, it is necessary to transport equipment over long distances, to build long oil pipelines. Also, transportation is carried out using tankers, tanks, etc. On average, the cost of exploration and oil production is 9.5-10% of the price of a liter of finished product.
Other costs
To calculate the cost of gasoline, you must also consider the cost of transportation. This indicator depends on many factors. It takes into account the location of the refinery from the place of extraction of the mineral, the type of transport, the cost of its maintenance. The most modern way is the use of pipelines. But even they need to be served. The cost of transporting oil on average is 1.2% of the total cost of a liter of gasoline.
Further, the raw materials are processed using modern techniques to obtain the final product. Production costs average 6% of the price of a liter.
After processing, the finished product arrives at the gas station. And this is another cost item. The costs of retail sales include the acquisition of a plot for the construction of a gas station, construction work, including the construction of roads. Next, you need to hire staff and pay for the content of the outlet. This article in the cost of gasoline is about 11%.
Considering what the cost of gasoline in Russia, you need to pay attention to another cost item. Throughout the entire chain of production and delivery of fuel to consumers, each organization requires profit. The organization independently lays its level in the cost. This is necessary so as not to go into minus. This figure is about 23.3%.
Sometimes the entire process, from production to sales to the final consumer, is carried out by one manufacturer, for example, Rosneft. But more often, each stage is carried out by a separate enterprise.
Taxes
According to official figures, taxes account for 49% of the cost of gasoline production. Each company engaged in the process of manufacturing gasoline pays fees, which are the following amount from the price:
- Income tax is 4.8%.
- Excise duty - 12%.
- VAT - 15.3%.
- Mineral extraction tax - 16.9%.
In fact, the price of oil only 1/3 affects the cost of a liter of gasoline in Russia. The basis of prices is taxes. Moreover, 49% is the minimum number of them. Depending on the production technology and other nuances, this indicator may be higher. According to some reports, taxes reach 73-74% of the total price. They can be distributed as follows:
- Mineral extraction tax - 38.1%.
- Excise duty - 19.16%.
- VAT - 16.54%.
To date, the industry has developed a situation where gas stations cannot pay for themselves. In 2018, the number of unprofitable gas stations increased. But the companies themselves, which are engaged in the extraction, refining and transportation of oil, have much less impact on the price of a liter of fuel. This high cost is explained by taxes.
It is also affected by certain aspects of the export policy in the industry. The main source of budget are oil and gas companies. If the demand for fuel and other refined products falls, the government has a policy of compensating for the missing amount. For this, excise taxes are increasing. As a result, the retail price of gasoline is growing.
But it is worth noting the opposite. If demand begins to grow, paradoxically, but the price also increases. It is becoming profitable for the company to export oil, so domestic tariffs are starting to rise. The quantity of goods is reduced.
What affects retail prices?
The real cost of gasoline can be affected by seasonal fluctuations in demand. So, according to expert analysts, in the season of mass holidays, the need for fuel increases significantly. In summer, companies literally do not manage to produce enough gasoline. As demand grows, according to the laws of the market, value increases.
But not only such fluctuations can affect the cost. The political situation in the country, export policy and many other factors affect pricing.
One of the rather large cost items is the maintenance of gas stations. The fact is that today there are a huge number of them. The supply is increasing, but the costs of enterprises for servicing outlets are also increasing. This can not affect the price. The more gas stations the company has, the higher the total cost. To understand why there is such a trend, you need to consider the main nuances of the content of gas stations. So, considering what the cost of 1 liter of gasoline is made up of, it is worth noting that this may include:
- The cost of the plot on which the gas station is built. In the city, finding a suitable place is quite difficult. Moreover, the cost of such a site is sometimes very high.
- Then a range of construction works is carried out, the equipment of the station is in accordance with all the rules. This is a fire and explosive facility, therefore, high demands are placed on the development of the project, the construction of the complex. This increases the cost of construction work.
- The process of transporting gasoline is being organized. The farther the gas station is from the refinery, the higher the cost of fuel.
- Salaries to staff. Gas station employees receive not only a monthly payment for their work. The company calculates social benefits, pays holidays, sick leave, etc.
Since there are practically no fixed costs for the construction and operation of a new gas station, it can be argued that the more gas stations in the city, the higher the cost of gasoline.
Why is gas cheaper in Venezuela?
Considering the cost price of gasoline in our country, the question of such a low cost of fuel in the domestic market of Venezuela raises a reasonable question. Why is the price unbelievably low here?
It is worth noting that Venezuela is the world's largest oil exporter. But the main reason for the low cost is the availability of state subsidies. The state provides support to oil companies, which is about $ 12 million. These funds are used to pay for fuel purchased domestically. Therefore, a liter of gasoline in Venezuela is cheaper than a liter of water.
The cost of fuel in Venezuela has been stable over the past 17 years. A gradual rise in price can only provoke economic instability here.
If we consider the cost of 95 gasoline in Russia, it can be noted that about 60% of taxes from its value are paid by the consumer. At the same time, the amount of fees levied on the refinery is 20-30%.
In countries such as the UAE and Venezuela, support is provided specifically to the buyer. For this, funds are allocated from the state budget. At the same time, oil refineries and oil producers pay 70% of such tax. This is the difference in similar pricing. In Russia, support is provided for manufacturers. But at the same time, the state does not stimulate domestic demand.
Comparison with the US market
The cost of a liter of gasoline in the US market is formed by other laws. The cost of fuel in this country is close to the level of our country, but salaries are higher. There are several reasons for this. It is worth noting that the direct distillation method is practically not used in this country. Applying new, more advanced technologies, it is possible to get 3 times more gasoline in the process of processing a unit of raw materials.
The gasoline tax in the USA is 30-40%, which is not comparable with our level of 50-65% or even higher.
The cost here also depends on the city. But in general, buyers buy gas quite often in small-town gas stations. In large cities, they are noticeably smaller. This reduces the cost of buying or renting a plot for the construction of a gas station. Bright advertising attracts buyers. They refuel their cars mainly in such retail outlets.
To stabilize the situation in our country, the government was forced to reduce the amount of excise duty. This did not lead to lower retail prices. But their growth was still suspended. So, during the election period, price increases were artificially suspended. This led to the fact that many gas stations began to work at a loss. As soon as the elections were over, such organizations were forced to raise the cost, since now they had to offset their costs.
Current pricing system device
The cost of gasoline includes, as before, tax. Oil refineries pay it twice. First, you need to pay for each ton of raw materials at a fixed rate of mineral extraction tax. Further, the vast majority of companies export oil to European countries. Therefore, they also pay export duties. When transporting oil, it is 30%.
It is profitable to sell raw materials to European countries, since here they are willing to pay more than consumers in the domestic market. Exactly as much fuel is sold in Russia as necessary to ensure the minimum need for this product. The foreign market remains unchanged in priority. Moreover, both oil and finished fuel are exported here. The cost of gasoline, which is supplied to Europe, is 7-9 thousand rubles. In the domestic market, the price is less.
It is worth noting that sometimes price increases are formed due to natural causes. For example, with a decrease in fuel supplies to the domestic market, a deficit arises. This gives sellers the right to add value.
Tax maneuver
Considering how the cost of gasoline is formed, you can understand the complexity of the situation in the country. To normalize the situation in the domestic market, it is planned to carry out the so-called tax maneuver. Between 2019 and 2024 gradually, in several stages, oil export duties will be abolished. At the same time, the severance tax will increase. This will remove such a negative phenomenon as double taxation. Producers will transfer to the budget a single fee from the extracted raw materials.
This approach will allow you to receive a single tax by managing incoming flows. Those products that oil companies transport to the domestic market will be subsidized. Gradually, the optimization process in the oil industry began in 2015. At this time, the severance tax was increased. However, now it is required to logically complete the transformation, which is planned to be done in the next 5 years.
Now for the management and distribution of flows in the oil refining industry will become a “floating excise tax”. It should compensate for the difference between export and domestic prices. At the moment, the difference between them is significant. It is about 8 thousand rubles. per ton of raw materials.
The proposed scheme is able to compensate for the difference of only 3 thousand rubles. It is proposed to compensate only up to 1.5 thousand rubles. cost. If the same price difference persists, it will be unprofitable for manufacturers to supply products to the domestic market.
Excise
Most of the cost of gasoline is excise duty. Since price increases had to be urgently halted, this tax was temporarily reduced. This situation will continue only until the end of 2018. Next, a new increase in excise taxes is planned. This will lead to a further increase in gas prices. However, the government claims that the cost will remain the same. At the same time, oil refineries will be required to leave the price at the level of 2018.
For disobedience, it is planned to raise the export duty to 90%, despite the developed program for its abolition by the end of 2024. Therefore, in conditions of complete uncertainty, “freezing” prices at the same level becomes an almost impossible task. We can only expect an increase in the cost of fuel in the domestic market.