Lithuanian gasoline losing ground in Latvia to Norwegian competition

  • 2006-05-24
  • From wire reports
VILNIUS - Latvian imports of Lithuania-made gasoline declined considerably over the first three months of 2006, while the market share of Norway's Statoil increased considerably, according to reports. As a result, the share of Lithuania's Mazeikiu Nafta, the only crude oil refinery complex in the Baltics, declined to 47 percent of Latvia's total gasoline imports in the January-to-March period from 80 percent in the first quarter of 2005. The trend has forced Mazeikiu Nafta to scramble in an effort to recover lost market share.

At the same time the share of Norway-produced gasoline soared to 52 percent from 9 percent. Latvia's Norwegian gasoline imports totaled 76.3 million liters in the reporting period, compared with 68.4 million liters from Mazeikiu Nafta.
Ojar Karcevskis, chairman of Latvian Fuel Traders Association, attributed the plunge in exports of Mazeikiu Nafta to Latvia to the measures implemented by the Norway-equity gas stations chain of Statoil. "Statoil, which imports fuel for its gas stations via a Latvian marine terminal, prioritizes Norwegian gasoline. In the future, the supply from Norway will increase," he projected.
Delivery of fuel by sea is more advantageous in terms of cost savings (compared with delivery by rail), he noted. Karcevskis admitted that the quality of fuel delivered from Lithuania had not worsened; however, the decline of its sales in Latvia resulted from the passive and inflexible pricing policy of Mazeikiu Nafta.

Curiously, the share of Lithuania's diesel fuel on the Latvian market rose to 37 percent, from 17 percent of Latvia's total imports of diesel fuel in the first three months of 2005. Gasoline imports from Russia in the first quarter amounted to 1 percent of total fuel imports, down from 12 percent last year. Diesel fuel imported from Belarus comprised 104,670 tons, or 56 percent of the total. In the first three months Latvia imported 38,778 tons of fuel oil, or 89 percent of the total, from Belarus. Fuel oil imported from Estonia accounted for 6 percent (1 percent in 2005) and 5 percent was imported from Russia (41 percent in 2005).