Experts from the Institute of Macroeconomic and Territorial Studies conducted a detailed analysis to understand the influence of global oil price fluctuations on gasoline prices in Uzbekistan from 2022 to 2023. The findings of the analysis revealed a notable correlation between changes in world oil prices and their impact on gasoline prices at the Republic Commodity Exchange, albeit with a one-month lag.
The analysis utilized data from January 2022 to November 2023, incorporating wholesale gasoline prices from the Republican Commodity Exchange, retail gasoline prices in Tashkent, and World Bank oil prices.
For instance, during 1H 2022, a 39.2% surge in world oil prices corresponded to a 22.4% increase in the average wholesale gasoline price on the exchange. Conversely, in 2H 2022, a 33.2% dip in world oil prices resulted in a 21.3% drop in average wholesale gasoline prices.
Following the stabilization of global oil prices and the elimination of excise tax for AI-80 gasoline from December 10, 2022, the average wholesale gasoline price ranged from UZS 4,848 to UZS 5,060 (from $0.39 to $0.41) from January to May 2023.
However, from June to November 2023, the average wholesale gasoline price experienced a 10.2% increase, rising from UZS 5,315 to UZS 5,860 (from $0.43 to $0.47). During this period, the average world oil price increased by 11% (from $73 to $81 per barrel).
An econometric analysis revealed a sensitivity of the average wholesale gasoline price, encompassing high-demand AI-80 and AI-92, to changes in world oil prices. Specifically, a 1% increase in world oil prices was associated with a one-month delay in the average wholesale gasoline price, with AI-80 gasoline increasing by 0.32% and AI-92 gasoline by 0.54%.
Retail gasoline prices in Tashkent displayed similar dynamics, responding to changes in average wholesale prices. A 1% increase in wholesale gasoline prices on the Republican Commodity Exchange led to a 0.29% increase in retail prices in Tashkent.
Despite a November decrease in the average price of oil on the world market to $81.35 per barrel (an 8.7% decline from October), the average retail price of AI-80 gasoline in Tashkent increased by 2.3% in December (UZS 7,611 / $0.61) compared to November (UZS 7,440 / $0.6). This surge was attributed to increased demand for AI-80 gasoline due to methane gas supply restrictions during colder weather in mid-December.
Given that part of the oil and gasoline product demand in Uzbekistan is covered by imports, changes in world oil prices significantly impact domestic gasoline prices. Consequently, gasoline prices in Uzbekistan align with global oil prices with a one-month lag.
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