In the public discussion of the Competition Authority's report No. 2/2015, Market research on the fuel market, which was published this morning, it has emerged in the responses of oil companies that the regulator does not take into account the size of markets, population density and transport and distribution costs when comparing mark-ups on the Icelandic and British markets.
On this occasion, the Competition Authority wishes to emphasise the following:
In the initial assessment report, the price comparison between Iceland and the UK is based on figures from the operations of the Icelandic oil companies and an estimated retail mark-up, based on that of British independent retailers which have one of the highest retail mark-ups in the country. The price comparison takes into account the Icelandic oil companies' purchase prices, transport costs to Iceland, and distribution and stockholding costs in Iceland. The preliminary finding that Icelandic consumers overpaid 4.0–4.5 billion krónur (including VAT) in 2014 is based on the lower end of the comparison and is therefore conservative.
Further information can be found in sections 6.3.2 and 6.3.3 of the draft assessment report on the Competition Authority's website.
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