The government of Kyrgyzstan has decided to lower excise on diesel fuel from 500 soms per 1,000 liters to 200 som, Prime Minister Nikolai Tanayev said.
He said this was aimed at creating a reserve and stimulating the activity of oil traders. It is also expected to solve the problem of fuel supplies for farmers during the spring field work. By lowering excise for diesel, the government hopes prices will drop, Tanayev said.
The Kyrgyz Association of Oil Traders has repeatedly asked the government to lower excise for diesel to increase demand and fight contraband.
If oil traders don't lower their prices, we'll deal with them, Tanayev said.
Despite the temporary restriction of petroleum product exports Kazakhstan is ready to provide Kyrgyzstan with a quota for 15,000 tons of diesel, he said.
The Kyrgyz government passed a resolution to buy 10,000 tons of diesels and 5,000 tons of gasoline in late 01.2004 for the state reserve to build supplies for the spring field work.
Kyrgyzstan lowered excise for gasoline in 04 .2003 from 3,000 soms to 1,500 soms per ton and for diesel from 800 soms to 500 soms per ton. According to the Association of Oil Traders, legal fuel shipments doubled in early 02 and the budget received additional 200 million soms.
Interfax, March 19, 2004