Lukoil Bulgaria CEO: We Are Ready to Switch to Zero-Profit Regime

Lukoil Bulgaria CEO Valentin Zlatev has stated the company's readiness to switch to a zero-profit mode in the case of a fuel price spike. Photo by BGNES

Lukoil Bulgaria CEO Valentin Zlatev has vowed that the company is ready to work at a zero profit in the case of a dramatic spike in fuel prices.

Zlatev's comments came on the heels of a Friday meeting with Economy and Energy Minister Delyan Dobrev and Transport Minister Ivaylo Moskovski.

Zlatev refused to reveal the concrete fuel price reduction measures he had presented at the meeting but suggested that a new moratorium on prices could be discussed.

He explained that one way to go about the situation would be to withhold prices, another one being to process crude oil without a profit.

Zlatev reminded of the one-month moratorium on retail fuel prices imposed in end-March 2011 and insisted that the move had had a positive impact and had alleviated the situation on the market.

He refused to commit to a forecast as to where crude oil prices would head.

The CEO of Lukoil Bulgaria explained that it was impossible to make predictions because "if military activities take place in the country that is one of the world's largest exporters, this could cause prices of crude oil, the raw material we use, to skyrocket."

Zlatev told journalists that a 34% spike in prices of crude oil processed at the Lukoil Neftochim refinery had led to increases of 13% and 16% in prices of gasoline and diesel.

Asked whether a new freeze on retail fuel prices was looming ahead, Zlatev said that the outcome of the talks would be announced after a second meeting that would be held in the presence of Prime Minister Boyko Borisov.

He went on to say that what Lukoil could do was to sell at cost prices, eliminating any markup.

Zlatev suggested that Lukoil was already operating without making profits.

He was adamant that the company was most interested in normal fuel prices.

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