According to Corriere Della Sera this morning ( I know the paper is called Courier of the Evening but hey you can’t be picky here) ENI have announced that fuel prices are to go down by 1 cent for diesel and 1.5 cents for unleaded petrol. They are the first and the others have yet to follow suit. However as winter is coming LPG will go up by 1 cent.
Apart from Holland, Italy has the highest fuel prices in the EU driven by the highest excise duty and 22% VAT which is why the central government is so disinterested in the cost of fuel. The price of a barrel of Brent crude is now the same as it was in 2011. Average fuel prices yesterday before the ENI announcement were €1.81 for petrol and €1.71 for diesel.
How does that compare to 2011 well Diesel was at €1.51 and petrol at €1.65 so seemingly we have a long way to go to actually get the fuel price down to 2011 levels. Will they return there, don’t hold your breath only the poor consumer is really interested in lower prices and the consumer as we know has no voice in Italy at all. I am reading a book by Tom Brewer called Branson: Behind the Mask and one chapter describes his travails with Virgin Mobile in Australia, Canada and USA . His advertising falls foul of the regulators for over promising and hiding charges. Oh to have a regulator in Italy for mobile phones or fuel prices or electricity prices ( has anyone ever figured out an Enel bill ?).
Italy imports almost all of it’s fuel and spends €62 billion doing so each year. Our leader is determined to reduce that figure as part of his need to reduce the deficit to please young Angela in Berlin. He hopes to reduce it by at least €14 billion by 2020 and to do so has repealed articles 36,37,38 to allow drilling for oil both on and off shore ( Italy has the third largest known oil reserves in Europe and it is expected that a load more can be found off shore).
Yesterday the Puglia Regional Council called on him to re-instate the articles and to go further by calling on the EU to ban any oil exploration or drilling in the whole of the Mediterranean Sea .
The council claim that Puglia has borne the brunt of the drive for solar power farms, wind turbines and the like which is a bit rich to be fair as many of the self same politicians are under investigation for fiddling the land deals and possibly accepting ( could it be true) bribes. No not an Italian politician surely.
The council is worried that off shore drilling could ruin Puglia’s beaches which is a worthy cause I’m sure though these are the same fellows that have allowed huge oil refineries to be built in Taranto and Brindisi and have done little to monitor the effect they might have on the population.
The cynic in me therefore starts to look at the real reason these eager wind and solar farm enthusiasts don’t want off shore drilling. Maybe we need look no further than down the road in Basilica where drilling is happening a pace in the big oil field there. Under the Renzi repeal he has sweetened the pie for regions that find oil. More money stays in the Region for ” development” and politicians here love those loose terms. Industry Minister Flavio Zanonato last fall described the move to spend more locally as having a “dual objective:” to reduce unemployment in the regions and build consensus in favour of increased production.
The Val d’Agri field has already created a mini boom for Basilicata. Between 2008 and 2012, Eni and Shell paid the region almost €500 million in royalties.
The Basilica oil is being piped to Puglia but all the extra dough stays in Basilica. Off shore oil would similarly be merely piped or bought by tanker to Puglia and still no “development lolly” .
Put a bit of pressure on the boys in Rome and who knows what concessions you might get from them ! No no I know the Council has merely gone green on the issue, of course they have.
I’m not sure anyone has told Cyprus that 6 regions in Italy want the government to lead the crusade to prevent any oil development in the Mediterranean Sea as yet. Here the papers are full of the terrible Turks who have announced they are to do seismic blasts in an area the Cypriot Greeks are already testing. Here the Greek Cypriots are always searching for the next money spinner that will solve the problems that they could easily solve themselves . First it was the Brits buying houses by the thousand, when that dried up it was the Russians and now that has dried up all the property ads are in Chinese. However the oil and gas reserves promise to give them wealth to live like sheikhs in Saudi Arabia they think and I don’t think Puglia regional council is going to dissuade them in a hurry.