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Russia: Putin has instructed his government to stabilize retail fuel prices

The Russian president Vladimir Putin today instructed his government to ensure stable retail prices in fuellooking ahead to additional measures to balance the domestic market after imposing a ban on gasoline and diesel exports.

Putin also said the government must act immediately and that revising taxes on the oil industry is an option.

The government introduced on Thursday a temporary ban on gasoline and diesel exports to all countries outside a circle of four former Soviet republics in order to prevent an increase in domestic fuel prices.

While prices initially fell on the domestic commodity exchange, they started to rise again when an easing of restrictions was announced over the weekend.

Measures taken, but prices are rising…The consumer needs a resultsaid Putin. “I asked you to react to the events more immediately».

Deputy Prime Minister Alexander Novak told Putin that the government was looking forward to additional measures.

He said there were proposals to curb gray fuel exports and raise the fuel export tax to 50,000 rubles ($518.24) a tonne from 20,000 rubles for resellers.

The government is reconsidering cutting so-called depreciation payments, or refinery subsidies, that began this month, Novak said.

THE Russia has been facing shortages of petrol and diesel fuel for the past few months. Wholesale fuel prices rose, even as retail prices were cut in an attempt to bring them in line with the official rate of inflation.

Shortages have been particularly painful in some parts of southern Russia, where fuel is vital for harvesting crops. A serious crisis could be unpleasant for the Kremlin as presidential elections approach in March.

Source: News Beast

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