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Craze over fuel discounts Thursday in Latvia

Because of significant snap fuel-price discounts at Neste, Circle K, Virši-A and Viada fueling stations, big lines formed Thursday on roads where gas station are located, Latvian Television reported December 15.

At Circle K fuel stations on Thursday from 14:00 to 17:00, fuel prices were reduced by €0.15 per liter. Representatives of the company indicated that the discount was in place at the same time at the 2,000 fuel stations of the company's group across Europe. The maximum amount of fuel to be refilled per car was 100 liters – so a 15 euro discount.

Also at Neste fueling stations, the price of fuel on Thursday from 13:00 to 17:00 was €0.15 lower per liter.

Viada, on Thursday, offered a 0.10 euro per liter discount for Viada Plus customers all day, whereas Virši-A said on Facebook their prices would be "particularly low".

Lines formed almost instantly at the stations, and staff had to regulate traffic at the fuel pumps. In Rīga, the lines stretched out on the streets and created congestion as a result of which public transport was made 40 minutes late, according to Rīgas Satiksme (Riga Transport).

On social media, economist Pēteris Strautiņš wrote that there was no reason to rush to fueling stations. Fuel traders, however, said something else.

The head of Virši-A communication,  Undīne Priekule, stated: “No pronounced downward exchange price fluctuation has occurred today. It has even climbed a little."

The price rivalry on Thursday between fuel stations was sparked by the big competition among traders, not by the drop in the price of fuel. One reduced the price, others jumped on it so as not to lose market share.

Priekule noted: “The prices at the moment are very close or already below self-cost. But consequently, in order to provide this equivalent offer, we had to apply these discounts.”

Traders acknowledged that such discounts are not planned soon and fuel prices will not fall sharply in the near future, though the whole exercise and teporary chaos on the roads will serve as a useful illustration of the nature of the market, consumers and pricing policies. 

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