A study presented on Thursday by Laurian Lungu, Co. – founder of Consilium Policy Advisors Group (CPAG).

“We need investment in this sector. Romania, Europe and the whole world are moving towards this climate transition, but the speed of its achievement will largely depend on the purchasing power of consumers. You may have the greenest technology, but how many of us can afford it? There is great variation between states or between the purchasing power of citizens of different states. Time is running out to achieve these climate goals,” Laurian Lungu also believes.

The level of dependence on Romanian gas imports reached the level of 2008 after a period of decline. We are importing more at higher prices and that means pressure on the trade balance, apart from energy security, Laurian Lungu added.

The additional tax on additional revenues from gas sales alone amounted to more than 6.2 billion lei in the first half of 2022, which is equivalent to 2.7% of total government revenues and 10 times more than for the whole of 2020.

These are significant sums that represent a significant share of transfers to the rest of the economy, allowing the authorities to maintain the redistributive effect of capping energy prices, says Laurian Lungu. Natural gas continues to bear most of this tax burden, supported by high natural gas prices. However, the erosion of domestic natural gas production has accelerated over the past three years, partly due to lower investment as the overall level of taxation, particularly on gas production, remains high

The oil and gas sector accounted for approximately 3.8% of GDP in the first half of 2022. In comparative terms, in the mentioned period, the contribution of the oil and gas sector to the GDP is: more than twice the contribution of the GDP of the “Financial Intermediation and Insurance Sector” is equal to the construction sector and is half of the contribution of the IT&C sector.

See the full study here