The government will begin inspections to determine what is causing the rapid increase in fuel prices at gas stations. This was explained in the studio of "Speak Now" on BNT by the Minister of Environment and Waters Yulian Popov. In some places, the increase in just a week is 7-8 cents per liter.
"The very rapid increase is strange, I am sure that the government will react with inspections to determine what is causing the rapid increase. How much exactly the price will rise is difficult to say, it depends a lot on how the military actions will develop and how the world market will be rebalanced."
Regarding the price of crude oil, Popov commented:
"I would be surprised if the price of oil rose permanently above $100 per barrel. This is another reminder of the EU's dependence on fuel imports. In this constantly unstable world situation, we must think and advance policies that reduce this dependence, and this is very important. The market is global. In terms of abandoning Russian fuels, the EU paid trillions more because it relied on Russian fuels. Russia manipulated the fuel markets before the war in Ukraine, and if we do the math - how much we paid on top as the EU, it will come out to be something huge."
When asked if an inflationary wave and a rise in food and commodity prices are expected, the Minister of Economy replied:
"High electricity and water bills are a special conversation. Are they high, are they not high, and is their increase justified. Every government has tools with which it can oppose inflationary waves. There are of course anti-inflationary measures that can be implemented, but we have to wait a bit to see what the result will be. I would not urge us to panic. We just have to watch what happens and be prepared for it."
There are no critically low or critically high levels of dams in Bulgaria at the moment, the minister announced.
"I am the minister of water where there is, not of water where there is none. The water where there is none is in the water supply and agriculture, not in the Ministry of Environment and Waters. The Ministry of Environment and Water manages 52 dams, which are complex dams. These are the large dams. There is not a single settlement that is on a water regime and is served by these dams. That is, from the point of view of the Ministry of Environment and Water, we have a clear conscience. There are no critically low or critically high levels of dams. There was panic two weeks ago, a lot of rain falls, the dams are starting to overflow. Some dams are overflowing. They have spillways. The spillway is for overflowing. So no one should worry. However, regarding what we call a water crisis, it is not with natural waters. Although Bulgaria is generally poor in water resources. It is not rich in water resources. But the main holes are in the water supply system, in the water supply network. There are many settlements that have losses of 90%, even higher. So that is one problem. And the other problem is in agriculture. I think that the current government is already addressing this problem quite seriously. But we have a lot of work to do in this direction. Water supply and water supply management is the problem that we need to address."
There will be settlements on a water regime this summer as well, the Minister of Environment noted.
"I personally will be on a water regime because I have a house in a place that does not have a water supply. And whenever I am a minister, this is the third time it has happened to me, my fellow villagers say: "What kind of minister of water are you, and you can't run a pipe here? I will try, even though I am not a minister. As long as I am a minister, I won't be able to. Small villages are a problem. And places like Pleven and others, where there is no question of a dam. The holes in the system need to be filled, they need to fall, and then we can think about what the water supply should be and where it should come from. On top of all this, there is also climate change, which increases stress, but it is not the problem."
The armed conflict in Iran may affect the European economy mainly through energy prices, which in turn will invariably make carbon quotas more expensive and may lead to stagflation. The dispute over the abolition of quotas began even before another war. The Minister of the Economy explained Bulgaria's position:
"The fact that there is a rebellion does not mean that there is a problem. On the contrary, emissions trading works extremely well. It is market-based. There is a dispute about the basis of this market. There are people who do not believe that carbon emissions have a harmful effect. There are those. All of science and, moreover, 200 countries, all the countries in the world, all governments, including the Chinese, the Russian, and the Venezuelan, i.e. those countries that are usually associated with high interests in the field of fossil fuels - they have supported this position. I.e. this is not the position of Brussels. So, the payment of these quotas, in one form or another, is globally accepted. There are 50 emissions markets in the world, not just the European market."
Electricity prices in Bulgaria are one of the lowest in the European Union, Popov pointed out.
"The fact that fuel prices are rising does not mean that quota prices will rise. In a sense, relatively speaking, it is exactly the opposite. Now, if we have a jump in electricity prices, for example, this component that is responsible for the increase due to quotas will become much smaller. It will even become insignificant if they rise, let's hope that this will not happen, a lot if prices rise. The other thing that many people avoid and do not realize is that emissions trading generates revenue. Revenue that the state has. Our electricity prices are the lowest in the European Union, or the second lowest in the European Union, because of the income that is received from the prices of the quotas, which go into the energy system security fund and with this fund the price of electricity is suppressed. If we do not have this income, we cannot suppress the price of electricity. I personally do not agree with this policy of suppressing electricity prices. It should be aimed at the energy poor, and not at everyone, because in this way, richer people are practically subsidized, who do not need to be subsidized, i.e. this is not a social policy. This is an anti-social policy, the reduction of electricity prices. But we are reducing electricity prices thanks to these quotas. So they are preserved and this is a political tool that is in the hands of the government, the National Assembly and the governance of the state in general.
Yuliyan Popov emphasized that Bulgaria is violating an EU directive regarding quotas.
"We are violating, among other things, a European Union directive, which we have supported, by the way, since 2003, which clearly states that the revenues from the quotas should go to decarbonization of the economy, with one exception - to support the energy-intensive industry for a certain segment, which is important. So, with the support of suppression, with this wrong policy of price suppression, we are depriving ourselves of a resource with which we can help the Bulgarian industry develop and be more competitive."