This Monday, Galp’s executive president criticized the report by the National Energy Sector (ENSE), which was the basis for the Government to move forward with a diploma to limit margins in the marketing of fuel, saying that it is “full of errors” .
At a telephone conference with analysts, regarding the company’s results for the first half of this year, the president of Galp, Andy Brown, was “disappointed” with the Government’s intention to temporarily set maximum margins for the marketing of fuels and bottled gas and pointed out problems to the regulator’s work in the way in which companies’ gross margins were calculated.
“If we look at ENSE’s report [Entidade Nacional para o Setor Energético] we were disappointed, because there were a lot of errors in the way they calculated the margins, 80% of the increase in margins they talk about are errors in calculations”, guaranteed.
“We don’t know what this legislation will bring, we are waiting for the proposal [de lei], speak of a short-term intervention, in cases of extreme growth in margins”, emphasized the new CEO of Galp.
“If we look at the pump price today, 12% of this goes to distribution costs”, he indicated, referring that the group has “700 gas pumps to manage, 900 direct jobs, 2,500 indirect jobs, a huge number of people”.
“This commercial business only generated about 7% of our EBITDA (the result before taxes, interest, depreciation and amortization) in the second quarter and the refining 1%”, but they count on “40% of all employees”, he explained.
That is, “the idea that this is where we make our money is sad”, he assured quoted by Público, guaranteeing that the final price of fuels weighs about 60% in taxes, in one of the “heaviest taxes in Europe”.
The Brit — who used the English idiom “barking up the wrong tree” (“bark at the wrong tree”), used to say that someone has the wrong idea about a certain subject – he concluded by referring that “any type of regulation is negative” and ensuring that the company will make its opinion “clearly to the Portuguese Government”.
Last week, the Government approved in the Council of Ministers (CM) a proposal for a law that will allow the executive to limit the margins in the sale of fuels through an ordinance, if it considers that they are too high “without justification”, according to the Minister of Environment.
In a press conference, after the CM, João Pedro Matos Fernandes he said that this diploma, which also covers gas cylinders, will now be sent to the Assembly of the Republic, stressing that the measure will be “limited in time”.
This bill aims to “give the Government a tool so that, when the margins in the sale of fuels and gas cylinders are proven to be unusually high and without justification, this power, by decree, to limit these same margins”, said the government official. .
“Once approved [a proposta de lei], so can the Government, always listening to ERSE [Entidade Reguladora dos Serviços Energéticos] and the Competition Authority, by decree, always for limited periods in time, which I imagine a month, two months, administratively fix the maximum margin for the sale of fuels”, said João Matos Fernandes.
The government official recalled that this margin is “also a sum of margins related to transport, storage, wholesale distribution, retail distribution itself”, and these reference values ”continue to be calculated from day to day day by ENSE”.
The margin of sellers, at the end of June, was higher by 36.6% in gasoline and 5% in diesel at the average margin practiced in 2019, according to a study by ENSE, released on July 14th.
“On Wednesday, June 30, 2021, the calculated margin on gasoline was higher than the average margin practiced in 2019 by 0.069 euros (or +36.62%). In the case of diesel, the margin on the last day of June was 0.01 euros higher than the average for the year 2019 (or +5.08%)”, then announced ENSE, which is supervised by the Ministry of Environment and Action Climatic.