Experts: Energy Prices Falling in Market, Price Increase in Serbia in May Probably Unnecessary

The prices of electrical energy for households and companies in Serbia, and also the prices of gas, have approached the levels of the market prices at the European exchange and a new price increase in May will probably not be necessary, even though that is the recommendation of the International Monetary Fund (IMF) according to the standby arrangement, energy experts said yesterday.

Regarding the statement of the president of Serbia, Aleksandar Vucic, that the prices of electricity and gas will not increase, the energy consultant Zeljko Markovic says that those prices are falling in the world market and that, therefore, the recommendation of the IMF to increase the electricity prices in May this year by 8% and of gas by 10%, will most probably not have to be implemented.

– The IMF’s recommendations are binding, but each one, at the moment it is supposed to be implemented, is checked by an analysis of the prices and if no price adjustment is necessary, an adequate explanation will be given. According to the current trends, the price of electricity should not increase – said Markovic.

Vucic said the previous night for RTS that there would be no new energy price increase so that Serbia would remain attractive to foreign investors.

Markovic said that, in the standby arrangement with Serbia, the IMF had given the recommendation to increase the price of electricity for households at the moment when it had been far below the market price.

– In the meantime, the price of electricity in Serbia increased and slowly approached the market price, but the market price also grew due to the energy crisis. The price of electricity in the market is now falling – said Markovic.

The energy expert Milos Zdravkovic said that, with the price increase for households in Serbia, the European level had been reached.

– The price of electricity should not increase, regardless of the recommendation of the IMF, which most easily opts for an adjustment of that price because it is most easily collected and the tax revenues are used to fill the budget – said Zdravkovic.

In mid-2022, energy sources were sold at record prices, electricity cost EUR 700-800 per MWh, and gas nearly EUR 300 per MWh, that is, 1,000 cubic meters cost USD 3,360.

Until 2021 and the energy crisis, electricity cost EUR 50-100 per MWh, and 1,000 cubic meters of gas cost USD 426.

Međunarodni monetarni fond-MMF Beograd

Predsedništvo Republike Srbije

Elektroprivreda Srbije ad Beograd

IMF

International Monetary Fund

Aleksandar Vučić

Željko Marković

Miloš Zdravković

electricity price increase

gas price increase

IMF standby arrangement