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Reduction in fuel prices: Minister Konrad Mizzi thanks GRTU for its constructive proposals that led to change in strategy that enabled Government to lower fuel prices
16 February 2015
During the MCESD meeting called by GRTU to discuss fuel prices, the Minister for Energy and Health, Hon Konrad Mizzi, thanked GRTU President Paul Abela for the suggestions he made for change in the hedging strategy. The Government had stated that lowering fuel prices in line with the global trend, to better reflect the current fuel prices, was not possible due to the hedging agreements in place. Through his experience Mr Abela suggested that the Government hedges while the international prices are very low and average out the difference in price so that a reduction can be instituted with immediate effect.
Hon Mizzi said this suggestion was welcome and implemented with immediate effect and hence, following the new hedging, Government could announce an immediate reduction in fuel prices and that gradual and regular decreases will follow every month. The Minister also said that Government was using a short-term hedging strategy and this is the strategy it will continue using as it gives flexibility and the opportunity to react rapidly to changes in the market. In addition Mr Abela also put forward a suggestion of exploring the possibilities of introducing a stabilisation fund. This type of system was used to control price spikes for other commodities in the past. The Minister said he will look into the mechanism of the fund.
In addition Mr Abela also suggested that the Minister should come to MCESD to agree on a policy on fuel purchasing, while details were not necessary it would improve transparency and collective responsibility.
