12° Nicosia,
23 July, 2024

Fuel price cuts have begun

Platt's prices are down around 20%, retail prices are down while estimates for the next period are uncertain.

Maria Eracleous

Maria Eracleous

Following a month of price volatility, the Cypriot market should see a reduction in the cost of motor and heating fuels in the coming days. According to Konstantinos Karagiorgis, the head of the Consumer Protection Service, prices at the European level appear to be decreasing, with the drop in platts' prices hovering around 20%. Based on this data, and after observing these fluctuations over the last 20 days, Karagiorgis believes that the next shipments of fuel that companies will purchase will be cheaper.  "In general, there is a downward trend, which we hope will have a larger impact on prices in the coming days," he added. Savvas Prokopiou, president of the Pancyprian Association of Petrol Station Owners, stated that some petrol stations have already reduced their fuel prices and that in the coming period, fuel prices are expected to fall by 5-10 cents, beginning this week and continuing until the first week of December. The price cuts apply to all types of fuel, including motor and heating fuel.

Current Prices

However, there are no unjustified fuel prices at the moment, according to Karagiorgis. According to the Consumer Protection Service's Fuel Price Observatory, the average retail price of 95-octane unleaded was 1.525 euros/litre yesterday, Tuesday (with 1.434 euros/litre being the cheapest and 1.569 euros/litre being the most expensive). Diesel was the most expensive fuel, with an average price of 1.795 euro/litre (cheapest price at 1.727 and most expensive price at 1.899 euro/litre). In terms of heating oil, the national average price is 1,328 euro/litre (the cheapest price is 1,272 euro/litre and the most expensive price is 1,519 euro/litre). According to the weekly fuel price overview bulletin, average fuel prices in Cyprus were lower on average on November 21 than in the rest of the European Union.  Although Cyprus does not import crude oil, but rather finished refined products such as gasoline, diesel, and heating oil, crude oil is the raw material and is undoubtedly a factor influencing the final prices of petroleum products. The fluctuations in international Platts prices (which determine the marketing prices of the main refined consumer products) appear to be trending downwards in the latest available record, on 21 November and are at lower levels compared to October. Platt's prices for 95 octane unleaded are also falling. They were at their highest point for 2022 in June of this year.

Fine Tuning

Future developments do not guarantee that these lower prices will be maintained in the market, far from it. The issue of imposing a cap on Russian oil, as described by international media, is expected to be resolved in the coming days. The cap promoted by Western countries, which are discussing the possibility of imposing a ceiling of between $65 and $70 per barrel for Russian oil, is expected to take effect on December 5. According to a Financial Times report, the goal is to reduce Russian revenues while maintaining the flow of Russian oil to the market.  Simultaneously, on December 4, OPEC countries, including Russia, will meet in Vienna to discuss the scenario of production cuts. Any such decision will have a significant impact on the price of black gold.

Eventually, electricity

In the case of electricity costs, the corresponding reduction that is expected to result from the drop in international fuel prices will occur later and over a two-month period. According to Christina Papadopoulou, the organization's spokeswoman, the adjustment of fuel costs is made every end of the month, so in early December, there will be a clearer picture of the cost of electricity in the next period. In November, AHK's bills decreased by 1.5% when compared to October. Similarly, there was a 5% decrease in October compared to September. Overall, the November bill is expected to be 6.5% lower than the September bill.  However, when compared to the same period last year, the bill has increased by 17%, and when compared to 2020, the bill has increased by 60%. Despite these increases, Cyprus remains close to the EU average. According to the most recent Household Energy Price Index (HEPI) report, Cypriot households paid 31.67 cents per kilowatt hour in October, ranking Cyprus 14th among the 27 member states. The average across the EU was 35.85 cents. It should be noted that the figures include household electricity prices as well as taxes. Cyprus's position remains unchanged, as does the calculation of purchasing power parity.

[This article was originally published in Kathimerini's "Oikonomiki" and was translated  from its Greek original]

Cyprus  |  fuel  |  energy

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