The Bulgarian Commission for Protection of Competition (CPC) has introduced a significant package of 23 emergency and long-term measures aimed at stabilizing the country’s fuel market. This initiative comes in response to escalating geopolitical tensions and heightened volatility in global oil prices, which have raised concerns about fuel supply security.
Following an extensive investigation that began in March, the CPC’s recommendations are informed by a detailed analysis of the market and ongoing proceedings involving the Lukoil group. The analysis reflects the impact of the worsening conflict in the Middle East on pricing dynamics and supply security.
The CPC’s report encompasses all critical segments of Bulgaria’s fuel value chain, including refining, imports, storage, wholesale distribution, and retail sales. The effectiveness of crisis measures implemented by the caretaker government during periods of market stress was also evaluated. One key finding indicates that while government interventions have mitigated price increases, they have not entirely reversed the upward trend.
Market distortions were identified, particularly related to a special administrator overseeing Lukoil operations in Bulgaria. Discrepancies between wholesale and retail pricing at Lukoil-operated stations were noted, placing additional strain on smaller traders and producers. Following CPC intervention earlier this year, these disputed pricing practices were ceased.
A pivotal recommendation from the CPC is the establishment of a permanent fuel market task force under the Council of Ministers. This task force will consist of state institutions and industry representatives tasked with monitoring fuel availability, price movements, storage levels, and potential supply risks.
To enhance market transparency, the CPC proposed launching a weekly official fuel index that would provide international benchmarks alongside domestic pricing data and trading margins. This initiative aims to reduce uncertainty within the market.
Additional measures include stricter oversight across the entire fuel supply chain—from refinery operations to retail distribution. The CPC also advocates for developing contingency plans to ensure refinery continuity and diversifying crude oil supply sources.
Several proposals target sectors heavily reliant on fuel costs such as transport, agriculture, fisheries, and fertilizer production. The Commission has suggested implementing compensation mechanisms to alleviate increased operational costs during periods of elevated fuel prices.
The proposed package includes short-term stabilization tools like liquidity support mechanisms and guarantees for strategic fuel reserves. Additionally, there is a suggestion for postponing toll increases during times of extreme price pressure. A temporary fuel stabilization fund is also proposed, which would be financed through additional VAT revenues resulting from higher fuel prices.
The CPC further recommended temporary anti-speculation measures, adjustments to biofuel blending obligations, and flexible excise policies during prolonged periods of market stress. Compensation systems for producers and importers were also proposed to ensure full traceability throughout the supply chain.
Long-term reforms focus on improving access to tax warehouses, expanding fuel storage infrastructure, encouraging new market entrants, and reducing dependency on fossil fuels through electrification of transport and energy efficiency measures.
In parallel with these developments, investigations into Lukoil for suspected abuse of a dominant market position remain active. Earlier this year, the CPC requested comprehensive operational and commercial data from Lukoil Neftochim Burgas, Lukoil Bulgaria, and other major wholesalers operating within Bulgaria’s fuel sector.
