Gas Prices Increase in Armenia: From 180 to 250-280 Dram in Just Ten Days

Recently, liquefied gas prices in Armenia have sharply increased, rising from 180-190 drams to 250-260 drams. Economist Suren Parsyan explains this surge in an interview with NEWS.am by two factors: demand and monopolies. He stated, “For nearly 20 years, three importers—‘Flash’, CPS, and ‘Maxoil’—have dictated the rules of the fuel market. They have been dividing the market among themselves and periodically implementing a unified pricing policy. They raise and lower prices together. Currently, this market is under the influence of gasoline and fuel importers.”

If months ago, the increase in gas prices could be explained by the depreciation of the dram, now the dram is appreciating, but gas prices are not lowering. Importers claim that imported batches must be sold at the same price. “Under these pricing conditions, we will always have higher prices than the market in our market. They are not interested in having competitive prices; they have divided the market among themselves, and there are no new importers. If someone tries to import, they cannot sell because the retail network is also in their hands. Moreover, creating one's own retail network requires considerable time and investment,” the economist noted.

In this context, he emphasized the role of the Competition Commission and the government. “The Commission must study the market, identify the factors affecting the market, and ascertain how healthy the competition is. The government must also eliminate monopolies by changing laws and separate wholesale and retail trade, which is not being done. As a result, monopolies exist, and organizations in a dominant position in the market continue to increase their influence with their economic resources and other tools. There are no privileges for them regarding imports; they are so economically powerful that they push all small and medium businesses out of the market.”

The Commission for Economic Competition also stated that price control is exercised when dominant entities or anti-competitive agreements exist in the market, which are not characteristic of our market.

It is noteworthy that for the past week, Auroranews has been receiving complaints from citizens and continuously raising awareness of the issue, informing all competent authorities, including the Government.