According to Vedomosti, gasoline retail prices have increased over the last nine weeks and YTD they are up 1.4%.
We are reiterating our view that gasoline retail price dynamics no longer depend on the oil price due to the tight domestic supply/demand balance. The increasing trend in retail prices is quite reasonable, given the price freeze in 1Q12. However, we believe that current prices have not yet reached a level which would provide oil companies with the same internal market premium as existed in 2011. Therefore, we expect to see gasoline prices increase further in 2012. The news is supportive for Russian oils, in our view.