PM Vanhanen: Use of strategic oil reserves under consideration

Matti Vanhanen

Mauri Pekkarinen

print this

Prime Minister Matti Vanhanen (Centre) said on Sunday that the use of Finnish strategic oil reserves has been taken under consideration as means of stabilising and lowering the price of fuel.
      In an interview aired during a newscast on the commercial television channel MTV3, Vanhanen said that the government has held discussions on the issue and views have also been exchanged at the EU level. Many of the European Union countries have substantial emergency oil reserves, the use of which would make a significant difference in the oil market situation.
      The Minister of Trade and Industry Mauri Pekkarinen (Centre) told Helsingin Sanomat on Sunday that Finland's strategic oil reserves are considerably larger than the minimum amount stipulated by the EU.
      According to Pekkarinen, the government spent the entire Friday discussing different ways to relieve the fuel price situation. Pekkarinen believes there is little Finland can do alone, however. This is a matter for joint decisions at the international level.
      Over the weekend, several members of the Finnish Parliament called for swift measures from the government to keep the fuel price development in check.
      The head of the Parliamentary select committee on economy Jouko Skinnari (SDP) demanded the government present Parliament this week with a report on the availability and cost of energy.
     
The head of the Left Alliance parliamentary group Matti Korhonen, in turn, insists on a temporary but quick reduction in the fuel tax. Also the True Finns' chairman and presidential candidate Timo Soini urges flexibility in the fuel tax situation.
      Pertti Rauhio (SDP), special advisor to the Finance Minister, told Helsingin Sanomat that fuel tax reductions are not under debate.
      "The last time we had a similar situation, the EU ministers of finance issued a joint statement according to which they did not want any member state to embark on such tax measures", Rauhio commented. According to Rauhio, tax reductions would only lead to increased margins for fuel refiners and crude oil producers.
     
The fuel tax in Finland is currently EUR 0.5385 per litre. The breakdown of the consumer price of EUR 1.45/litre is as follows: fuel tax - EUR 0.5385, supplementary tax - EUR 0.0423, service assurance charge - EUR 0.0068, VAT - EUR 0.261. This adds up to overall taxes and charges of EUR 0.849, while the tax-free fuel price is EUR 0.601.
      At current prices, the share of taxation is 58.557% of the consumer price.


Previously in HS International Edition:
  Gas price spike will be immediate and abrupt at Finnish pumps (2.9.2005)

Links:
  Polttoaine.net (in Finnish)
  Calculator of fuel tax and charges (in Finnish)

Helsingin Sanomat