Gubad Ibadoghlu: "Foodstuffs prices must have dropped long before in Azerbaijan, but they are preserved artificially"

- Today we are witnessing a process of sharp drop in oil prices and the accompanying drop in prices in foodstuffs and most other goods and objects. Nevertheless, Azerbaijan seems to be isolated from all this, not even gasoline prices, but also foodstuffs prices do not seem to drop. Why is it so?

- In order to answer this question, it should be noted that drop in prices in oil importing countries is quicker than in the countries, which produce and sell it. For example, in such states, as Ohio and Minnesota of the United States, the gasoline prices have dropped down to 40 qepicks by our prices.

We witness the same process in Ukraine, which imports oil - there, in November, gasoline prices reduced to 40 qepicks in our prices, while the reduction is promised to be down to 30 qepicks in December. Consistently, along with energy sources, prices drop on most other goods as well.

At the same time, Azerbaijan does not fix any discussions regarding drop in prices. On the contrary, both SOCAR and Azerigaz are regularly speaking of the rise and future growth in prices in early 2009. They speak too much of it, as if preparing a ground for the January rise in prices.

Though, we must first of all speak of the rise in quality of services, in most Absheron settlements, especially in Buzovny, gas and electricity are often cut off, though it is even not winter now!

- Why do they need it?

- These talks about the rise in prices has a secret meaning. The statements of the biggest energy suppliers to the internal market have been made not by accident. It is as if they tell the producers - "Don't think of drop in prices, do not hurry. Anyway, we will raise prices on gasoline and gas in January of 2009 and only a month and a half is left to it".

SOCAR and Azerigaz consumers are also notified about the planned rise in prices in early 2009! The consumers now do not hope for the drop in prices, they just hope that it will not happen again and they will not be raised in early next year!

- That is, the situation is that people do not hope for good and hope that worse things will not happen...

- We should ask - why isn't the state reducing prices on gasoline inside the country? Because, the demand on it is growing in Azerbaijan. In 2003-2004 the country imported 55,000 cars, while now the number if 80,000-85,000. They are mostly not passenger cars, but trucks, buses and so on...

The state sells gasoline itself, as it is one of the small number of products, which it produces and sells. And it is interested in getting as much profit as is possible. Therefore, though I do not rule out possible drop in the cost of gasoline, I can speak of the rise in prices on it.

- Don't they understand that the drop in prices will cause positive chain reaction, leading to the drop in prices on foodstuffs?

- If Azerbaijan has been more bound to the world market and there is a drop in prices on fuel inside the country, the products would have been dropped in prices. A simple example - today farmers pay the same price for fuel and no discounts for them are envisioned.

The role of fuel spendings is high in the system of agricultural priduction, including land processing with tractors, irrigation, supply by the transport to the city markets and so on. If gasoline prices drop, the prices on fruits and vegetables would fall as well.

- Why don't the prices on import products drop? Their prices have reduced abroad!

- The import does not fall in prices, as it is regulated by monopolists in Azerbaijan. The wholesale centers also dictate their price. Import products must drop 29.3% falls on Euro zone, where everything has become cheaper. But... our customs also plays its role here.

- How much would a liter of gasoline cost, if economic processes inside the country would be similar to the world processes?

- The state oil company gives official data only on crude oil and it is difficult to get others from it. Today, the cost of production of a barrel of oil by SOCAR is $10. Along with refining we get about $20 per barrel. A barrel is 158 liters of gasoline. If we count, we will get 15-20 cents per liter plus excises. That is the price of 40 qepicks per a liter will be lower than the real but good for SOCAR.

/Day.Az/