16:22 GMT +325 September 2017

    Russian antitrust service orders 7 oil firms cut oil prices

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    MOSCOW, October 16 (RIA Novosti) - Russia's Federal Antimonopoly Service has demanded that Russia's seven largest oil companies reduce their prices for oil products, the service said on Thursday.

    Earlier Thursday, the FAS chief, Igor Artemyev, said the service could launch new price-fixing investigations against five companies: LUKoil, Gazprom Neft, the oil arm of Russia's energy giant Gazprom, the state-run giant Rosneft, the Russian-British joint oil venture TNK-BP and Surgutneftegaz unless they cut oil prices within two weeks.

    The other two companies are Tatneft and Alliance.

    Some oil producers have linked the cost of higher oil products to soaring global oil prices.

    "We have analyzed the oil price dynamics on the global market over the past month," Artemyev said. "World prices are falling. Oil currently costs around $70 per barrel, while we have seen no decline in the price of oil products here."

    The FAS first took legal action against the five oil giants last summer. Following an inspection, Gazprom Neft and TNK-BP were accused of breaching price-fixing laws, while allegations against Surgutneftegaz were dropped.

    The high cost of aviation fuel has recently hit airlines across Russia, including the AiRUnion alliance. In combination with a cash crisis and ageing fleet, the national air carrier suffered from flight delays across Russia in late August-early September after AiRUnion failed to pay off its outstanding debts.

    The Russian Technology Corporation, the Moscow government and the administration of Eastern Siberia's Krasnoyarsk Territory agreed in early September to merge several airlines from the AiRUnion alliance as a way of easing their cash-flow problems.

    President Dmitry Medvedev urged the Russian government Thursday to take drastic antitrust measures to curb high aviation fuel prices.

    "I am instructing the government to completely clarify through antitrust regulations what is going on in the sector, what price fixing there is, what the problem is, and take decisive action under antimonopoly regulations," he said at a meeting with government members and bankers outside Moscow.

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