Montenegro’s recent decision to cancel a planned diesel procurement has drawn attention as the country grapples with escalating fuel prices influenced by geopolitical developments, particularly in the Middle East. The procurement, which was set to enhance the nation’s strategic reserves, involved a tender worth approximately 11 million euros for 16,500 metric tons of EN 590 diesel, equating to around 19.6 million liters.
The Administration for Hydrocarbons attributed this cancellation to rapid price increases within the Mediterranean fuel market. This situation significantly limited the volume of diesel that could be purchased under the original budget constraints. Notably, this marks Montenegro’s second attempt at securing diesel supplies; a previous tender was retracted after Jugopetrol’s sole bid did not meet compliance standards.
In recent weeks, Montenegrin fuel prices have surged, with petrol rising by 7 eurocents per liter and diesel seeing an increase of 16 eurocents. Despite these hikes, diesel in Montenegro remains competitively priced compared to neighboring countries like Serbia, Croatia, Slovenia, and Albania. However, it is still higher than prices in Bosnia and Herzegovina and North Macedonia.
Officials from the Montenegrin government have reassured the public that fuel supply stability is intact, with no immediate shortages or threats to market equilibrium. The country currently holds strategic petroleum reserves totaling approximately 44,260 metric tons, which serves as a buffer against potential supply disruptions.
Smaller fuel companies, especially those reliant on road imports without adequate storage capabilities, are encountering difficulties as market prices surpass regulated retail levels. This situation has raised concerns about profitability within this segment of the industry. In response to these challenges, fuel distributors are advocating for regulatory changes such as revising the current 14-day retail price calculation period and possibly reducing excise duties. Finance Minister Novica Vukovic noted that while a formal proposal for lowering fuel excise taxes has not yet been submitted, it remains under consideration based on ongoing energy market trends.
