Moldovan Fuels' Market: Assessment of the Regulatory Framework, Competition and Price Formation

Publishing date: Tuesday, 20 December 2011
Views: 17574

The regulatory framework of the Moldovan fuels’ market contains several important flaws which negatively affects the competition due to many entrance barriers, the inefficient methodology for computing the market prices, as well as the discrimination of the small firms in favor of the large ones. This paper has identified the inconsistency between the fluctuations of the fuels’ prices on the regional and domestic markets. Thus, the domestic firms react faster and stronger to price increases, as compared to price drops on the foreign markets, which reveals the firms’ reluctance to decrease the prices in periods when this is possible. In order to solve these issues related to the regulatory and competition framework, we recommend a series of policy measures based on 3 main priorities: (i) strengthening the competition on the market; (ii) improving the price formation regulatory framework; (iii) protecting the fuels’ quality sold on the Moldovan market.

Full version available only in Romanian.

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