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The Expected Turnaround –  Fuel Price Cuts Start Immediately


After a long time, fuel prices in Hungary will start to fall, based on a recent data release from Holtankoljak, reports Világgazdaság.

According to the fuel price monitoring blog, the wholesale price of petrol will remain unchanged, but

diesel will drop by HUF 4 (1 EUR = 393 HUF) per liter.

The partial fuel price cut comes into effect today, Thursday. As a result, vehicle owners can expect the following average prices at petrol stations:

  • petrol – HUF 616 per liter (EUR 1.56),
  • diesel – HUF 623 per liter (EUR 1.58).

It is important to stress that these are average prices, which may differ from the typical retail price at the pumps. Based on past experience, the price of petrol is now below HUF 615 per liter and the price for diesel is around HUF 625 per liter.

Average price of diesel in Hungary and in neighboring countries. Source: KSH

The current fuel price cut was preceded by a halt to the price rise on Monday. On that occasion, fuel wholesalers reported stagnation, also meaning that a long negative streak had been broken. Before that, there had been ten fuel price increases in a row in Hungary.

Average price of 95 petrol in Hungary and in neighboring countries. Source: KSH

Between June 14 and July 4, the wholesale price of petrol rose by HUF 26 and that of diesel by HUF 39. This is particularly disappointing because, for about two months, the opposite trend has been taking place. From mid-April, partly due to government action, a massive price cut was introduced at domestic pumps. On April 17, the average price of 95 petrol was HUF 650 per liter and that of diesel HUF 647.

Fact

From January to now, the wholesale price of petrol has risen by 86 forints per liter and the price of diesel by 65 forints, although 41 forints is due to the mandatory increase in excise duty in January. Apart from this, petrol prices have risen by HUF 45 and diesel by HUF 24. After an increase of around HUF 70-80 per liter, an average 50-liter tank of petrol costs HUF 3,500-4,000 more now than in December last year.

The fact that diesel prices have finally started to fall again since mid-June can be explained by several factors. On the one hand,

the government made it clear last week that since average prices in Hungary are higher than in both regional and neighboring countries, it expects dealers to cut prices. Otherwise, it will intervene in the market.

As in the spring, the cabinet’s warning seems to have had an effect.

However, at the same time, there is now room for a reduction in fuel prices, as international trends are pointing in the same direction. The price of Brent oil per barrel has fallen from USD 88 on June 5 to below USD 85 now. The forint is also holding steady against the dollar. The exchange rate is currently around 363, the previous high in June was HUF 4 more.

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If there is no shift towards the average price in neighboring countries, the government is ready to intervene.Continue reading

Via Világgazdaság; Featured image via Facebook/Orlen





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