Stock prices for fuel in August to continuously decline, eclipsed by 5-15% from the July highs and now approaching the end of may. The reason — to increase fuel supplies to the domestic market due to the improved economic performance of the refinery. Further decline in wholesale prices could lead to improvements in profitability and retail business. However, experts recognize that the situation is not tenable, also in September will begin a new repair campaign at the refinery.The price of AI-92 and AI-95 have decreased on SPICEX with maximum values of 5% and 15% to 49.2 thousand rubles per ton and 50.5 thousand RUB per ton, respectively. According to the exchange, the price of AI-95 at the end of June reached a record in the history of trading, AI-92 has risen in price by the end of July to maximum values in may 2018.The sharp rise in fuel prices on the exchange began in April and may against the background of a recovery in demand after the easing of quarantine restrictions in the regions. The refinery, which reduced processing after the introduction of restrictions, were not ready for the full restoration of production.The fundamental reason for the falling prices is that until the beginning of August on the Russian wholesale market, petrol was trading with a very high premium relative to export alternatives, says the head of “Petromarket” Ivan Khomutov. The prize was formed in may when refinery suffered losses and were forced to minimize them by increasing the price of gasoline on the Russian market.In July, the refinery out of the losses due to the rising cost of oil and export prices for petroleum products, making the maintenance of relatively high prices in the gasoline market is not as critical as it was in may and June, said Mr. Clamp. He notes that in the first week of August, the refinery increased the supply of gasoline at SPIMEX 8% relative to the last week of July. According to experts, the increase in supply was a direct cause of the collapse in wholesale prices.A key factor in the reduction of prices in the wholesale market — the growth of production and the supply of fuel from refineries to the domestic market, agrees Eugene Tyrtov from Vygon Consulting. According to him, the daily average volumes of deliveries of gasoline and diesel in July reached similar indicators 2019, and at the end of the month it even exceeded them, so prices fell.Moreover, says the expert, despite the falling prices, the supply of the domestic market is still more profitable to export, so potentially prices on the wholesale market can fall another 4-5%. As a result, in his opinion, the gross margin of the retail business will reach and even exceed the minimum required levels 4-5 RUB per liter.In recent weeks, independent gas stations were in a difficult position, as high wholesale prices forced them to sell fuel at a loss. Gas stations of major oil companies too are losing, but they kompensiruet high-income ��prowam and especially at the wholesale level.Now, according to Ivan Chomutov, gas stations remain unprofitable: on August 7, Russia on average net margin of trade AI-92 at the gas station amounted to minus 0.9 RUB per liter, AI-95 — minus 1.1 RUB per liter. However, the expert believes, should expect a quick decrease in wholesale gasoline prices followed the exchange out of the gas station into profit for the first time since the beginning of June. Retail gasoline prices at the same time growing very moderately, according to Rosstat, by 1.9% since the beginning of the year.At the same time, pay attention to the interlocutors “Kommersant” at the market, the situation in the wholesale sector remains fragile. Thus, the demand for fuel in the country has returned to the level last year, and the holiday season because of the coronavirus shifted to the second half of the summer. Start of seasonal maintenance on oil refineries in September and the decrease in shipments to the domestic market can lead to a new surge in prices, as was the case in 2018.Dmitry Kozlov