Georgia: Due to the ongoing war in Ukraine, prices of fuel have spiked globally because of the sanctions imposed by countries on Russia.
Russia is a major supplier of oil worldwide, and several countries are dependent on Russia for oil and gas. International fuel prices have been increasing in recent months, but the rise in the price of fuel has been more evident since the beginning of the Russian-Ukrainian war.
On the basis of a consolidated tender, the Government of Georgia, ministries, and public institutions purchase fuel from the country’s major oil companies. The purchase price of fuel is revised monthly based on a unique formula, according to the parties’ agreement.
The price is determined at the start of each month based on the average price of one tonne of gasoline recorded on the Platts European Market during the month. In February 2022, the average price of a tonne of Platts-branded fuel was USD 900, while in March, it hit a new high of USD 1,065.
Meanwhile, the national currency has been swiftly depreciating, and fuel costs have reached new highs in March.
Moreover, due to market change, the government will have to purchase more expensive fuel from April.
According to fuel types, new and old prices are divided as following –
• Regular fuel type- March – GEL 3.08, April – GEL 3.76, increase of 22%;
• Premium fuel type- March – GEL 3.09, April – GEL 3.77, increase of 22%;
• Super fuel type – March – GEL 3.42, April – GEL 4.12, increase of 20.5%.
In terms of gasoline prices for ordinary consumers, one litre of regular type fuel costs GEL 3.75-3.85 and premium type fuel costs GEL 3.95-4.00 while supertype fuel costs GEL 4.05-4.12.
As the national currency has strengthened in recent weeks, fuel prices are predicted to reduce in the coming weeks. The price of a barrel of oil has been decreased to USD 96, while the price of a tonne of PLATTS-branded gasoline is USD 995.