Bulgaria will create a national oil company to provide more competition among gas stations. This may force the Russian company Lukoil Bulgaria, which controls 70% of the fuel market of the country.
On the establishment of the oil company announced the Minister of economy Emil Karanikolov, BBC reports SeeNews. Amendments to the Law on state reserves of the Bulgarian Parliament at first reading adopted on Friday, 5 June.
According to Karanikolov, market presence of more number of retail sellers of fuel will lead to lower prices, better service and higher quality.
“The basic policy here are bonded warehouses. Through them in Bulgaria will be coming to more retailers, and we will have more stations,” said Karanikolov.
The future the company will manage the warehouses across the country, as well as to buy oil and petroleum products to replenish state reserves. State-owned warehouses to store the fuel of other companies. The network of filling stations, which will increase competition, plan to deploy during the year.
Why is a blow to Russian business
Against this idea stands the leadership of the Russian “daughters” the oil company Lukoil – Lukoil Bulgaria. The CEO of Lukoil Bulgaria Bulat Subaev said that the company may suspend operations due to legislative changes that require splitting its common customs warehouse into separate regional units.
Lukoil Bulgaria is considered to be a monopolist in Bulgaria. The company owns the largest refinery in the region and the largest network of filling stations (about 220), occupying a total of 70% of the fuel market of the country.