DECISION OF COUNCIL OF HEADS OF GOVERNMENT OF COMMONWEALTH OF INDEPENDENT STATES

of November 21, 2014

About competitive situation and pricing in the oil markets and oil products

The Council of Heads of Government of the Commonwealth of Independent States solved:

1. Approve the Report "About competitive situation and pricing in the oil markets and oil products" it (is applied).

2. To the interested ministries and departments of the State Parties of the CIS and bodies of industry cooperation of the CIS to consider conclusions and offers of the specified Report in case of market development of oil and oil products and enhancement of their regulation, paying special attention on development of stock exchange trading.

3. To interstate council on the antimonopoly policy, considering importance of questions of pricing of the sector of oil and oil products for development of economy of the State Parties of the CIS, to continue together with the national antimonopoly authorities and authorized bodies regulating this sphere, work in this direction.

Interstate council on the antimonopoly policy
Executive committee of the CIS

The report "About competitive situation and pricing in the oil markets and oil products"

Introduction

In the world goods markets there are serious basic changes. The most important changes affecting both technology of trade, and forming of general market conditions, are characteristic of the markets of exchange goods. In world trade by raw materials oil and its derivatives continue to play the dominating role.

Taking into account these circumstances Federal Antimonopoly Service (FAS Russia) and the Austrian Federal Competitive Department (AFCD) were initiators of creation in 2011 within Interstate council on the antimonopoly policy of the international Working group on studying of questions of pricing in the oil markets and oil products (further - the Working group).

In 2012-2013 five meetings of the Working group, part in which was taken by representatives of Kazakhstan, Russia, Ukraine, Austria, Great Britain, Germany, Portugal, the USA, etc., took place. Meetings of the Working group allowed to exchange within active dialogue opinions on urgent aspects of pricing on oil and oil products in the world markets, to discuss questions of ensuring the competition in the oil markets and oil products, the organization and procedures of carrying out the exchange biddings.

Special attention of the Working group was paid on activities of the world price agencies. Results of their activities influence as the markets of available goods - oil and oil products, and the markets of derivative financial instruments.

Became obvious that the overflow of free money between the oil exchanges and financial centers turned the international oil trade into one of the main factors of impact on the course and the direction of reproduction in global scales.

No wonder therefore that questions of monitoring and regulation of the financial and goods markets are in their interconnection in sight of "Group of Twenty" (G 20). The corresponding instructions were given to G 20 International organization of the commission on securities (IOSCO) - the organization combining finance regulators of the countries of the world (1). Following the results of the work IOSCO formulated, in particular, recommendations for activities of the world price agencies.

One more important element of the market is efficiency of use of the automated system of data collection and processing.

Following the results of monitoring information on price performance on oil products becomes available for a wide range of users. Results of such monitoring make basis for adoption of the decision by antimonopoly authority by hearing of cases about antitrust violation, and also considerations of transactions of merge and acquisition. Similar systems are applied in Russia, Ukraine, Austria, the USA and other countries.

Results of activities of the Working group during 2013 were reported at meetings of Interstate council on the antimonopoly policy in Minsk (Republic of Belarus) and Irkutsk (Russian Federation), in Paris (France) within the committee meeting on the competition of Organization for Economic Cooperation and Development (OECD), and also in July, 2013 in Geneva (Switzerland) during the meeting of the Intergovernmental group of experts on the competitive legislation and policy of the United Nations Conference on Trade and Development (UNCTAD).

It was shown that the world prices influence the prices in the national markets of both the large, and small states, both importing countries, and exporting countries of oil and oil products. The analysis of pricing has therefore great value both for separate industries, and for the states in general.

Experience of activities of the Working group and experience of creation of commercial infrastructure of the market of oil products are useful and significant for forming of favorable conditions as on national, and the world oil markets and oil products.

This Report is prepared following the results of the researches conducted by the Working group and the presentations at the forums stated above.

I. Main results of activities and initiative of the Working group

The first organizational meeting of the Working group took place in January, 2012 in Moscow. During the meeting there were particular purposes and tasks of the Working group, the main questions for studying, the work plan is created.

1.1. Approaches in methodology of the analysis of the goods markets of oil and oil products

Questions of methodology of the analysis of the goods markets of oil and oil products, accounting of features of wholesale and retail sale, and also features of these markets are caused by availability of oligopolistic structure and chains of the vertical integrated bonds between her participants. Experience of number of the countries in this area is below included.

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