In the video, Babiš quotes the title of a text by economist Lukáš Kovanda. The prime minister repeats that Orlen and MOL are “lining their pockets” in the Czech Republic on margins, and the Swiss bank’s analysis seems to give him the truth.
From the Prime Minister’s statement, it might seem that only domestic pumpers and their high retail margins are responsible for the high prices. This is determined by the gas stations themselves, but the amount is limited by competition and prices at nearby pumps.
Analysis of the Swiss bank for UBS clients, which is mentioned by the Investing.com server, but talks about the so-called refining margin. That is, simply put, profit from fuel production. That is, the difference between how much the refinery buys oil for, and how much it sells the produced diesel or gasoline to the distributor. For the refining companies Orlen and MOL, according to the Swiss bank, this margin increased by tens of percent above the long-term average. However, the government has only very limited possibilities to influence the global margin.
The solution to the current crisis is practically as if through the copier of the then Fialo government.
There is one more step between the refinery and the pump itself. Wholesale and distribution. It is here that Orlen has a strong position in the Czech Republic and can influence how much fuel smaller pumps buy. But the Swiss bank did not deal with that at all. Its analysis is an investment one and mainly evaluates the impact of margins on company profits, not specific prices for drivers.
According to Minister Alena Schillerová (ANO) herself, until the week before last, there was no indication that the market would abuse the conflict in the Middle East to increase surcharges. According to the Minister of Finance, the change occurred last week.
They have nothing to blame
In practice, Babiš’s government is doing the same as Fial’s government four years ago. It monitors fuel margins, for which the then opposition sharply criticized the government. Four years ago, Babiš literally claimed that “the ÚOHS should do the inspections”, his party colleague Radek Vondráček, in turn, spoke of “the Ministry’s scumbag”. In addition, the previous government reduced consumption tax by 50 crowns per liter for a quarter of a year. The current one has not done so yet.
“The solution to the current crisis is practically like going through the copier of the then Fialo government. They have the same solution and communicate it very similarly,” says Finlord company analyst Boris Tomčiak.
At the weekend, Babiš talked about the possible capping of margins. At the beginning of March, his finance minister Schillerová described such a tool as an atomic bomb in the economy. Babiš met with representatives of fuel distributors on Monday. They denied that they would abuse the situation. The fact remains that a significant part of the price of gasoline and diesel is made up of taxes (21% VAT and consumption tax).
After Monday’s meeting, the government stated that it voted to loan one hundred thousand tons of oil from the state material reserves to PKN Orlen, which operates an oil refinery in Kralupy nad Vltavou. At the next meeting of the government, the possibility of reducing consumption tax will be discussed.
The PoliCheck program monitors and analyzes the statements of politicians on social networks. You can find all the parts here.
