The economic staff is considering the continuation of the subsidy on diesel, as well as the extension of the fuel pass, as the rise in international oil prices remains strong and continues to burden households and businesses.
With a €200 million funding “cushion” available, scenarios on the table include extending the subsidy on diesel fuel to June, with the aim of containing costs across the supply chain and preventing a new wave of price increases on goods and services. It should be noted that with the horizontal subsidy of 20 cents per litre, the retail price has managed to stay below €2 per litre.
At the same time, the activation of the fuel pass for the two months of June and July is being considered, in order to absorb part of the increases in unleaded petrol, which significantly raise the cost of transport for citizens. Already in the week, a new rise in wholesale prices is expected, which are approaching 1.6 euros per litre, with retail prices exceeding 2.1 euros.
According to estimates, the cost of extending the subsidy on diesel for June is estimated at around 40 million euros, while the two-month extension of the fuel pass for June and July is estimated at 130 million euros.
At the same time, proposals for a subsidy on electricity bills (power pass) are also on the table, but serious reservations are being expressed by the General Accounting Office.
Discussions about new interventions are intensifying due to the continued upward trend in international Brent oil prices, which remain firmly above the psychological threshold of $100 per barrel. As an indication, futures reached as high as $114 yesterday, after surging to $126 last week.
These developments are creating a chain of pressures on the economy, slowing growth and adding to inflationary pressures. Recall that, due to the crisis in the Middle East, the government has already revised downwards its growth forecasts and upwards its inflation forecasts for 2026, based on the assumption that Brent will be priced at $89 per barrel.
