Oil importers are asking the government to postpone the transition to Euro 5 standard diesel for one year.
A strategic partner of Georgia, Azerbaijan, was prevented from starting the Euro-5 standard diesel production by a coronavirus. The country needs one year to be able to produce diesel that meets the Euro 5 standard.
38% of diesel imports to Georgia are Azerbaijani. SOCAR mainly imports fuel from Azerbaijan, as the company told report.ge, diesel will become more expensive if its import from Azerbaijan stops due to the new standard.
Levan Giorgadze, the director of SOCAR Georgia Petroleum, explains that apart from the fact that diesel of this standard is relatively cheaper than Euro 5, the logistics chain itself from Azerbaijan is much simpler, more flexible, and less expensive than importing by sea. Giorgadze explains that the supply of Euro 5 standard diesel will be mainly from the sea, which will increase the price of diesel by about 10-15 tetri for the population.
"Our desire and request are to postpone the deadline and enact a new standard from January 1, 2022. We believe that the price of fuel will increase if there is no import from Azerbaijan. It will be a big blow to industries such as the agro-sector and the transport sector. A considerable amount of money is spent on transit vehicles heading east from Turkey and vice versa. Since fuel is expensive in Turkey, we offer diesel fuel to transit cars at a very competitive price because we have a cheap source from Azerbaijan. We will lose this competitive advantage if we adopt this standard prematurely," Levan Giorgadze, CEO of SOCAR Georgia Petroleum, told report.ge.
