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FUELED BY DRAM DECLINE: CURRENCY MARKET INSTABILITY LEADS TO HIGHER PRICES AT LNG STATIONS
NEWS | 12.12.14 | 15:45
http://armenianow.com/news/59315/armenia_liquefied_gas_price_transport_dram_dollar
Alina Nikoghosyan
ArmeniaNow intern
The recent increase in the dollar exchange rate that resulted in
price increases has also affected the prices of liquefied compressed
gas (or liquefied natural gas, LNG), which has angered bus drivers,
some of whom say they cannot work at the current tariff any longer.
Since Thursday drivers have had to fill their tanks with fuel that
is approximately 10 cents more expensive than before - 230 drams per
cubic meter instead of former 180 AMD. They say this adds to their
costs to the extent that it is no longer profitable to work.
Some economists relate this price increase to the dram depreciation
(during the recent days one dollar has traded at up to 470 AMD, while
only in mid-November it was 410-415 AMD). But there are contradicting
opinions as well, according to which gas station owners increase the
price on their own initiative.
Economist Vahagn Khachatryan thinks that gas station owners came to an
internal agreement and increase the price as much as they want. The
current increase is up to 23 percent, while in the currency markets
the dram devaluation has been estimated at 11-13 percent so far.
Besides, Gazprom Armenia said that gas is sold to the companies at
the same price and the new prices at the gas stations is inexplicable
to it.
However, liquefied compressed gas price increase can affect public
transport tariffs as well, and bus drivers have already started
complaining, some said they will not work until the matter is solved.
Bus drivers say they have to add an extra 3,000 drams (about $6)
to their daily costs, while a normal fare in Armenia is 100 drams
(about 20 cents). Yerevan authorities' attempt to raise the public
transport fare by 50 percent in 2013 met with strong opposition from
civil activists and the decision had to be reconsidered eventually.
The Ministry of Economy addressed the problem of liquefied compressed
gas increases, saying that the State Commission on the Protection of
Economic Competition will study the issue and if the price increase
is arbitrary, those responsible will be penalized.
NEWS | 12.12.14 | 15:45
http://armenianow.com/news/59315/armenia_liquefied_gas_price_transport_dram_dollar
Alina Nikoghosyan
ArmeniaNow intern
The recent increase in the dollar exchange rate that resulted in
price increases has also affected the prices of liquefied compressed
gas (or liquefied natural gas, LNG), which has angered bus drivers,
some of whom say they cannot work at the current tariff any longer.
Since Thursday drivers have had to fill their tanks with fuel that
is approximately 10 cents more expensive than before - 230 drams per
cubic meter instead of former 180 AMD. They say this adds to their
costs to the extent that it is no longer profitable to work.
Some economists relate this price increase to the dram depreciation
(during the recent days one dollar has traded at up to 470 AMD, while
only in mid-November it was 410-415 AMD). But there are contradicting
opinions as well, according to which gas station owners increase the
price on their own initiative.
Economist Vahagn Khachatryan thinks that gas station owners came to an
internal agreement and increase the price as much as they want. The
current increase is up to 23 percent, while in the currency markets
the dram devaluation has been estimated at 11-13 percent so far.
Besides, Gazprom Armenia said that gas is sold to the companies at
the same price and the new prices at the gas stations is inexplicable
to it.
However, liquefied compressed gas price increase can affect public
transport tariffs as well, and bus drivers have already started
complaining, some said they will not work until the matter is solved.
Bus drivers say they have to add an extra 3,000 drams (about $6)
to their daily costs, while a normal fare in Armenia is 100 drams
(about 20 cents). Yerevan authorities' attempt to raise the public
transport fare by 50 percent in 2013 met with strong opposition from
civil activists and the decision had to be reconsidered eventually.
The Ministry of Economy addressed the problem of liquefied compressed
gas increases, saying that the State Commission on the Protection of
Economic Competition will study the issue and if the price increase
is arbitrary, those responsible will be penalized.