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Notes from Poland is run by a small editorial team and is published by an independent, non-profit foundation that is funded through donations from our readers. We cannot do what we do without your support.

Poland has detained and charged five current and former senior managers at state energy giant Orlen as part of an investigation into allegations that the company artificially lowered fuel prices in the run-up to the 2023 parliamentary election.

At the time, many experts and the then-opposition – which won that election and is now in power – accused Orlen of cutting prices to help the then-ruling national-conservative Law and Justice (PiS) party’s re-election campaign.

Prosecutors say that the decisions made by the executives constituted “a gross violation of procedures” and caused “over 4.1 billion zloty” (€938 million) of financial damage to the company. If found guilty, the accused could face up to 25 years in prison.

At the end of August 2023, just over a month before the elections, Orlen, which controls around 60% of Poland’s fuel market, began sharply cutting its wholesale petrol prices as well as the prices at the large network of petrol stations it runs.

By early October, the wholesale price of unleaded petrol had fallen by nearly 12.7%, while average prices at petrol stations had dropped by about 10%.

The price cuts, however, puzzled experts because oil prices on international markets were rising and the zloty was weakening, both of which would normally push fuel prices higher.

The relatively low prices in Poland encouraged some motorists from neighbouring countries to travel to Poland to tank up, while some Polish drivers began stockpiling fuel. Just days after the election, held on 15 October, fuel prices began to rise.

Figures from the then-opposition accused Orlen of lowering prices to win popularity for the government ahead of the elections. Under the leadership of its then-CEO, Daniel Obajtek, the company had regularly carried out actions seen as beneficial for the ruling PiS party. Obajtek is now a PiS MEP.

In October 2023, Krzysztof Brejza, a lawmaker from the centrist Civic Coalition (KO) – which was then in opposition and is now Poland’s main ruling party – notified prosecutors of a potential crime. He claimed that strategic fuel reserves had been emptied as part of Orlen’s price-cutting move.

Now, after a lengthy investigation, prosecutors have announced that five current and former managers have been detained. One, named only as Michał R. under Polish privacy law, served as a member of Orlen’s board from 2018 to 2024.

The others are identified as an executive director, two office directors, and the head of a department responsible for pricing.

 

The National Prosecutor’s Office said that all five had been charged with causing large-scale economic damage, which carries a prison sentence of between five and 25 years.

“The charges concern abuse of power and failure to fulfil managerial duties, causing damage to Orlen in the amount of over 4.1 billion złoty in connection with the implemented pricing policy,” wrote prosecutors.

They said that the main aim of that pricing policy was to keep the price of fuels below the psychological threshold of 6 zloty per litre, and that this was carried out “in a manner detached from market realities…in gross violation of numerous formal and informal procedures applicable to the managerial staff at Orlen”.

Speaking anonymously to broadcaster TVN, one of the prosecutors involved in the case said that the executives’ actions had implications not only for Orlen’s finances, but also Poland’s national security, given that strategic reserves are meant to be saved for emergency situation.

“State security was jeopardised for the sake of politics,” they said. “These reserves are intended, at a time of war, to ensure there is fuel for tanks, to put it simply.”

Meanwhile, justice minister Waldemar Żurek, who also serves as prosecutor general, wrote on social media that Orlen and Obajtek had, by “manually controlling prices”, “acted to the detriment of national assets in order to save the party’s [grip on] power”.

Obajtek today rejected the allegations and defended Orlen’s actions under his leadership. He accused the current government of acting to distract from its own failure to keep fuel prices under control.

“They couldn’t cope with rising fuel prices so – for show and without any substantive justification – they’re detaining experienced managers thanks to whom fuel cost less than 6 zloty [per litre] in the summer and autumn of 2023,” he wrote on social media.

“If I have to answer for the fact that Poles paid little for fuel, then I would be honoured,” he added.

However, speaking at a press conference, Żurek declared that, “in a state governed by law there are proper procedures for lowering prices”. Instead, under PiS, there was “a state of lawlessness, a state run like a private fiefdom”.

In a separate case, the European Parliament last year stripped Obajtek of legal immunity to face charges for allegedly using Orlen’s funds to serve his own private interests. Polish prosecutors are also pursuing him for allegedly violating Poland’s press law and falsely reporting his income in a tax return.

Last month, the Financial Times reported on how, under Obajtek’s leadership, Orlen lost $230 million (856 million zloty) trying to buy Venezuelan oil through intermediaries, unsecured payments and cryptocurrency transfers.

Obajtek, however, argued that he managed to turn Orlen into one of Europe’s largest companies, including diversifying it away from its traditional focus on oil and towards other forms of energy, including gas, hydrogen and renewables.


Notes from Poland is run by a small editorial team and published by an independent, non-profit foundation that is funded through donations from our readers. We cannot do what we do without your support.

Main image credit: Orlen (press materials)

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