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Report shows positive asymmetries in the transfer of auto fuel prices

By  |  July 5, 2012

Spain’s Comisión Nacional de la Competencia (CNC) has released a new report on the automotive fuel distribution market in Spain. The CNC found that the market is insufficiently competitive. The following conclusions were drawn:

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    1. In 2011, pre-tax prices and margins in Spain were amongst the highest in the EU.
    2. In the provinces, there is a direct relationship between service station concentraiton and the average pre-tax prices in the province.
    3. The short-term behavior of margins is influenced by rigidities in the adjustment of national pre-tax retail prices in response to variations in international fuel prices.
    4. Pre-tax retail prices react faster to increases in international prices than to declines.
    5. More is at work than just collusion. 

    The Commission urges implementing the recommendations it made in its 2009 report, such as reducing barriers to entry.

    Full content: Comision Nacional de la Competencia

     

    Related content: The New Spanish Competition System

     

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