Petrol station owners warn of more price hikes this week

Petrol station owners’ association chairman Christodoulos Christodoulou on Monday warned that prices at the pump will continue to increase this week, with the price of a litre of diesel having gone above €2 last week. “The forecasts are that we will not have anything soon which will lead to a reduction in fuel prices,” he told the Cyprus News Agency, before adding that the price of a litre of both petrol and diesel is expected to increase by two or three cents before the week is out. He said that that estimate is based on international oil prices, saying that “for several days, a barrel of oil was $108 or $109, and we believe that the prices corresponding to these levels have not yet been passed onto the market”. The price of a barrel of oil peaked at a little over $106 on September 15, and as of Monday evening now sits at $90. Related Articles • G7 countries agree on release of diesel and oil stocks after US pressure • Cyprus fuel sales fall 1.4 per cent as pump prices climb • Diesel prices hit historic high, calls for VAT cut • Fuel prices on the rise, despite assurances Christodoulou went on to say that the price of fuel in Cyprus is also impacted by the price at which it is sold by refineries in Greece, given that Cyprus does not have oil refineries of its own and therefore cannot buy crude oil itself. “We also monitor the refineries in Greece, at what prices they sell and what the situation is, so whether they are selling expensively or cheaply to the petrol stations, as they buy directly from the refineries in Greece,” he said. At present, he said, the average price of a litre of diesel is around €2.03, with prices ranging between €1.94 and €2.12 per litre, while the average price of a litre of petrol is €1.74, with prices ranging between €1.66 and €1.82. He also said that consumers have taken to putting smaller amounts of fuel in their tanks, frequently only paying for €20 worth of fuel at a time, before calling on the government to take more action to bring costs down. Govt now makes more in VAT from fuel than before On this matter, he said that a greater government subsidy could be utilised, given that when the price of a litre of fuel was €1.20, the government collected 19 cents of value added tax per litre, but that with a set price of €1.90 or €2, the government will now collect as much as 32 cents per litre of VAT. “The government could subsidise this difference for everyone,” he said. Consumers’ association chairman Marios Drousiotis, too, said that he believes prices will increase at the pump in the coming days, saying that “we are going into the unknown with a boat made out of hope” and that “what we estimate is that we will not see reductions” He also said that “more relief could be given” by the government to allow for fuel prices to be reduced and said that the current 8.33-cent-per-litre reduction on fuel consumption tax does not end up in the pockets of consumers. “It did not go to consumers, because it is up to the petrol station owner if he wants to reduce the price,” he said, adding that 19 petrol stations did not reduce their retail prices at all when the subsidy was introduced in April. He said he had brought this matter to the attention of the government at the time, and that “they told us it is not illegal”. Damianos had called on EU to offer more support Their comments come after Energy Minister Michael Damianos had last week said that he had called on the European Union to offer more support to “address the impact of the energy crisis” during a two-day informal meeting of the bloc’s 27 member states’ energy ministers in Dublin. “I called on the European Union to offer more support and appropriate funding to address the impact of the energy crisis and to reduce energy costs for people and businesses,” he said. European Energy Commissioner Dan Jorgensen was also present at the meeting and said afterwards that “months after the start of the conflict in Iran, it is clear that we are still facing an energy price crisis in Europe”. “We see little progress around the Strait of Hormuz. Global geopolitics remain extremely turbulent, and as a consequence, prices remain highly volatile,” he said. Regarding the measures member states’ governments could take to combat rising prices, he said that “it is important to stick to temporary and well-targeted measures”. “Fiscal resources are limited and we should not waste public money on measures that are counterproductive in a fossil energy crisis, and I urge governments to use the fiscal flexibility with which we have provided them for clean energy investments,” he said. Germany had suggested reducing VAT on fuel With these comments, he appeared to be warning against desire expressed in some parts of the continent for more radical measures to be taken to combat rising fuel prices, with German Economy Minister Katherine Reiche having said earlier this month that it would be “sensible” for value added tax on fuel to be temporarily reduced. At present, as a European Commission spokesman has previously told the Cyprus Mail, cuts to VAT on fuel would not be compliant with European Union law, but with prices continuing to rise, more drastic measures are being sought. In Italy, state-controlled energy company Eni having announced that at all its petrol stations across the country, it would sell diesel for no more than €2.19 per litre and petrol for no more than €1.99 per litre. At the same time, Azerbaijani state oil company Socar, which owns Italiana Petroli, announced that Italiana Petroli petrol stations would also have their prices capped, before later announcing that it would match Eni’s cap.