FAS and the Ministry of Energy signed a joint Order to set the minimum quantity of LHG sold through an exchange

The Order changes the No. 313/13/225 Order “On Approving the Minimum Quantity of the Oil Products Sold through an Exchange and the Requirements to Exchange Trading, when Transactions with Oil Products are Concluded by Economic Entities with the Dominant Position on the Relevant Markets” of 30.04.2013 in the part of setting the minimum quantity for selling liquefied hydrocarbon gases (LHP) through an exchange.

The Head of FAS Department for Control over Fuel-and-Energy Complex, Dmitry Makhonin, commented the novelty: “To develop organized trading with liquefied hydrocarbon gases the Federal Antimonopoly Service, focusing on the scope of domestic consumption in the Russian Federation, set the minimum quantity at 5% of LHG production for household needs and motor transport. In our opinion, developing an organized LHG market increases pricing transparency and reduces possibilities for price deviations by some companies”.

Changes introduced by the joint Order include decreasing the price deviation range in oil products and LHG sales orders and an additional exchange trading session to satisfy the buying needs, particularly, economic entities with the dominant position.

“Apart from satisfying the demand for oil products and LHG an additional trading session can enhance data objectivity estimating whether qualities sold through an exchange meet the minimum quality requirement. At the same time, economic entities with the dominant position have possibilities to conclude transactions between themselves at a particular session at the average weighted price formed as a result of the “main” trading, protecting themselves from possible claims by the antimonopoly body in the part of the prices formed based on such transactions”, pointed out the Head of FAS Department for Control over Financial Markets, Alexander Rasin.

In the near future the joint Order will be forwarded to the Ministry of Justice for official registration.