• 2 days PDVSA Booted From Caribbean Terminal Over Unpaid Bills
  • 2 days Russia Warns Ukraine Against Recovering Oil Off The Coast Of Crimea
  • 2 days Syrian Rebels Relinquish Control Of Major Gas Field
  • 2 days Schlumberger Warns Of Moderating Investment In North America
  • 2 days Oil Prices Set For Weekly Loss As Profit Taking Trumps Mideast Tensions
  • 2 days Energy Regulators Look To Guard Grid From Cyberattacks
  • 2 days Mexico Says OPEC Has Not Approached It For Deal Extension
  • 2 days New Video Game Targets Oil Infrastructure
  • 2 days Shell Restarts Bonny Light Exports
  • 2 days Russia’s Rosneft To Take Majority In Kurdish Oil Pipeline
  • 3 days Iraq Struggles To Replace Damaged Kirkuk Equipment As Output Falls
  • 3 days British Utility Companies Brace For Major Reforms
  • 3 days Montenegro A ‘Sweet Spot’ Of Untapped Oil, Gas In The Adriatic
  • 3 days Rosneft CEO: Rising U.S. Shale A Downside Risk To Oil Prices
  • 3 days Brazil Could Invite More Bids For Unsold Pre-Salt Oil Blocks
  • 3 days OPEC/Non-OPEC Seek Consensus On Deal Before Nov Summit
  • 3 days London Stock Exchange Boss Defends Push To Win Aramco IPO
  • 3 days Rosneft Signs $400M Deal With Kurdistan
  • 3 days Kinder Morgan Warns About Trans Mountain Delays
  • 4 days India, China, U.S., Complain Of Venezuelan Crude Oil Quality Issues
  • 4 days Kurdish Kirkuk-Ceyhan Crude Oil Flows Plunge To 225,000 Bpd
  • 4 days Russia, Saudis Team Up To Boost Fracking Tech
  • 4 days Conflicting News Spurs Doubt On Aramco IPO
  • 4 days Exxon Starts Production At New Refinery In Texas
  • 4 days Iraq Asks BP To Redevelop Kirkuk Oil Fields
  • 5 days Oil Prices Rise After U.S. API Reports Strong Crude Inventory Draw
  • 5 days Oil Gains Spur Growth In Canada’s Oil Cities
  • 5 days China To Take 5% Of Rosneft’s Output In New Deal
  • 5 days UAE Oil Giant Seeks Partnership For Possible IPO
  • 5 days Planting Trees Could Cut Emissions As Much As Quitting Oil
  • 5 days VW Fails To Secure Critical Commodity For EVs
  • 5 days Enbridge Pipeline Expansion Finally Approved
  • 5 days Iraqi Forces Seize Control Of North Oil Co Fields In Kirkuk
  • 5 days OPEC Oil Deal Compliance Falls To 86%
  • 6 days U.S. Oil Production To Increase in November As Rig Count Falls
  • 6 days Gazprom Neft Unhappy With OPEC-Russia Production Cut Deal
  • 6 days Disputed Venezuelan Vote Could Lead To More Sanctions, Clashes
  • 6 days EU Urges U.S. Congress To Protect Iran Nuclear Deal
  • 6 days Oil Rig Explosion In Louisiana Leaves 7 Injured, 1 Still Missing
  • 6 days Aramco Says No Plans To Shelve IPO
Alt Text

Will Low Oil Prices End Saudi Arabia’s Gas Subsidies?

Feeling the fiscal pressure from…

Alt Text

Hurricane Irma’s Wrath Weighs On Natural Gas

Hurricane Irma has left some…

Power Prices Bring Down Bulgarian Government

Power Prices Bring Down Bulgarian Government

Fuel prices can bring down a government, as the Bulgarian elite are now learning, and it doesn’t stop there.

As tens of thousands of people hit the streets in Bulgaria and engage in bloody clashes with the police over rising power bills and corruption, the government’s resignation isn’t enough and the streets are still seething, with at least 25 people wounded in the clashes.

Late last week, the Bulgarian government thought the mass protests-turned-riots would dissolve when the Parliament accepted the resignation of Prime Minister Boiko Borisov and his cabinet. Not so—the protests are economic, not political (at least, they have not visibly been hijacked by political opposition figures—YET). 

This week, President Rosen Plevneliev will appoint an interim government, but the protests continue unabated. The public is prepared to keep up the pressure until new elections can be held in April or May—and until they see decisive movement first and foremost against foreign-owned electricity distributors. 

Related article: How Low Wages can Lead to High Oil Prices

Bulgarians were not seeking a regime change, per se, they were demanding that something be done about rising power bills, wages and government corruption. 

To put this into context, protests on this violent scale are unprecedented in post-Communist Bulgaria, and there is fear that the sentiment could spread to other countries in Eastern and Southeastern Europe.

Among other things, Bulgarians would like to see an end to monopolies like that over electricity distribution, which they see as the root cause of increasing power bills.

Not only is the capital, Sofia, overrun with protesters, but the Black Sea city of Varna has seen daily rallies for the past 15 days. The largest protest was on Sunday, after the government’s resignation. As many as 40,000 protesters demanded the resignation of Varna Mayor Kiril Yordanov, whom they accuse of running the local economy with the Mafia. Thousands of protesters gathered outside Varna’s utility monopoly, Czech Energo-Pro (CEZ), on Sunday.  Protests against the Czech power distributor occurred in other cities as well.

Borisov had already promised to cut electricity bills by 8% beginning in March and to revoke CEZ’s license, but it was not enough to stop the protests. Bulgaria’s energy regulator earlier this month began the process of stripping CEZ of its licenses, saying it had evaded public procurement law, among other abuses.

Related article: Why is the Washington Post Surprised at High Gas Prices?

Since then, however, authorities have said that prices could not be cut before April—at the earliest—and that CEZ’s license would not be revoked, but some other compromise would be sought.

Of course, the Czech Republic will fight to keep any of this from happening. CEZ has vowed to defend its licenses by all legal means, and insists that only a full liberalization of the electricity market will help to lower high prices.

Bulgaria is the poorest country in the European Union, and rising power bills have come along with a freeze of public wages that is exacerbating the situation. The average monthly salary in Bulgaria is about $534. The country’s standard of living is only about 45% of that in other EU countries.

Protesters countrywide are calling for an end to electricity monopolies, an end to the value-added tax (VAT) on electricity and a review of all energy privatization contracts.

While economic in nature, the protests will necessarily be political, and the Socialists are likely to be the biggest winners in fresh elections that are just around the corner now. After all, the main point of the protests is that the public wants electricity distribution to be renationalized, which will not go down well in the Czech Republic, home of CEZ, or in Austria, which owns another key distributor in Bulgaria, EVN.

By. Jen Alic of Oilprice.com




Back to homepage


Leave a comment

Leave a comment




Oilprice - The No. 1 Source for Oil & Energy News