**Industry Warns Diesel Prices Could Approach €2 as Tax Relief Nears Expiration**
Fuel prices in Cyprus are under increasing pressure, according to industry representatives, as the international price of oil has surged above $90 (€78) per barrel. This rise has prompted concerns about potential increases in fuel costs for consumers, particularly for diesel, which is currently averaging around €1.60 per litre.
Christodoulos Christodoulou, spokesperson for the petrol station owners’ association, shared insights with the Cyprus News Agency regarding the recent developments in fuel pricing. He noted that the price of oil has escalated from approximately $80 (€69) per barrel to between $90 and $91 (€78 to €79) within just a week. However, he emphasized that it is too soon to predict how much of this increase will be passed on to consumers, as fuel companies must first receive shipments purchased at these elevated rates.
Christodoulou pointed out that petrol station owners do not have direct access to information about future price increases. Fuel companies are responsible for purchasing stock and submitting invoices to the finance ministry, which complicates the forecasting of retail price changes.
Adding to the uncertainty, the current extension of reduced excise duty on fuel is set to expire on September 17. Without a renewal of this measure, an automatic increase of 8.33 cents per litre, including VAT, will take effect for both petrol and diesel. This could potentially push the price of diesel close to €2 per litre, according to Christodoulou's estimates.
The existing tax relief reduces the excise duty on petrol from €0.429 to €0.359 per litre and on diesel from €0.40 to €0.33 per litre. The finance ministry has indicated that this relief has provided significant savings for the public, totaling approximately €15.5 million.
When questioned about the possibility of extending the tax relief, Finance Minister Makis Keravnos stated that such measures are "continuously evaluated in accordance with developments." He acknowledged that European Commission regulations require that any tax relief measures be targeted and temporary.
Despite the rising oil prices, Christodoulou reassured that there are currently no fuel shortages in Cyprus. Fuel companies are meeting the orders of petrol stations, and imports from Greece and Israel remain unaffected by the regional crisis.
As the deadline for the tax relief approaches, consumers and industry stakeholders alike are closely monitoring the situation, with potential implications for fuel prices in the coming weeks.