With emergency measures to contain prices in diesel and heating oil and possibly interventions in fuel taxation, the government will attempt to… contain the “fire” that is already burning consumers.
With its eyes fixed on developments in the EU and the risk that pressures may intensify which under specific conditions could lead to social unrest as is already happening in other countries (France, Germany, etc.) it is hurrying to intervene in the market, in order to limit transport costs and heating costs, for households and businesses.
The new support mechanism in its details will be announced on Monday, with heating oil at the center with the aim of entering the market on October 15 below 1.75 euros, the price at which it “closed” last April.
This specific intervention will be accompanied in November by an increase in the heating allowance for all forms (electricity, oil, natural gas, pellets, etc.).
At the same time the government is awaiting the “signal” from Brussels, in order to proceed with reducing the Special Consumption Tax on heating oil, in an intervention that is taking on an urgent character due to the race in fuel prices.
Energy inflation is expected to be at the center of today’s Eurogroup meeting in Dublin, under the presidency of Kyriakos Pierrakakis.
What the economic staff is seeking is to limit the “shock” at the pump even before the period begins during which households’ heating needs will increase.
Under the present conditions the price of heating oil would enter the market at 2 euros per liter, a prohibitive level for small and medium wallets, when last year the market opened at 1.10 euros per liter.
The excise tax
A key factor in shaping the final price is also the Special Consumption Tax. During the heating oil distribution period, the excise tax amounts to 28 cents per liter, bringing the State revenues of about 300 million euros.
This amount is essentially at the core of the fiscal equation the government is called upon to manage. Reducing the tax will correspondingly limit tax revenues, but on the other hand it is the most immediate tool for passing part of the fiscal intervention into the final fuel price.
If the Commission gives the “green light,” paper exercises will begin on the percentage reduction of the excise tax. The margin within which the price at the pump can move will also depend on the scale of the intervention.
The price of diesel and heating oil today stands at about 2.1-2.2 euros per liter, as a special consumption tax of 41 cents per liter is incorporated.
From October 15 the excise tax on heating oil falls from 41 to 28 cents. The price automatically decreases by 15-16 cents (together with the corresponding VAT) and the selling price would be 2 euros per liter. If support from the refineries continues, the price will decrease by at least 30 cents more, so that the final price is shaped at 1.6-1.7 euros per liter.
The benefit for the consumer is estimated at 40-50 cents per liter, compared with the initial price of 2.1-2.2 euros per liter that diesel and heating oil cost today.
The price of heating oil will be shaped even lower if the EU allows the excise tax to be temporarily reduced as well from 28 cents to as low as 21 cents per liter, which is the minimum permissible limit in the European Union.
The allowance
The reduction of the excise tax is one leg of the government plan. At the same time, as the Prime Minister announced, the government is proceeding with a horizontal increase in the heating allowance, so that support for households against higher prices is strengthened.
Today the allowance ranges from 100 to 800 euros, while for areas of the country with very low temperatures it can reach up to 1,200 euros. The increase being planned will work complementarily to the reduction of the excise tax, with the aim that state intervention will not be limited only to containing the price at the pump.
Diesel fuel
At the same time, the subsidy on diesel fuel is being extended through October as well, since high international prices have already passed into the fuel market, burdening transport, professionals and businesses.
Today the subsidy amounts to 10 cents per liter including VAT, while even an increase to 20 cents is on the table, provided fiscal margins allow it.
The available “piggy bank” for new interventions, from the 2025 surplus, is currently estimated at about 130-150 million euros.
The cap
To contain prices, the government intends to bring back -if conditions require it- the cap on fuels as well, as it was applied last spring (from March 11, 2026 to June 30, 2026). It was imposed as an upper limit on the gross profit margin per liter and not as a fixed, horizontal maximum price at the pump.
The measure was established by a Legislative Act (PNP) with the aim of preventing profiteering phenomena due to the geopolitical crisis in the Middle East, controlling profits at every stage of the supply chain (wholesale and retail).
For petroleum trading companies (wholesale) the maximum permitted profit margin was set at 5 cents per liter (for both 95-octane unleaded gasoline and diesel fuel) and for fuel stations (retail) at 12 cents, totaling 17 cents per liter overall.
For island areas there was a special provision, allowing the addition of the extra actual cost of distribution and sea transport of fuels above the general limit.
For violators who exceeded the aforementioned limits, strict sanctions and administrative fines were provided for that could reach up to 5 million euros!
The... champions
According to the latest comparative data from the Commission, the three most expensive countries in Europe, as regards gasoline, are Denmark, the Netherlands and Germany, with prices in these markets reaching 2.60 euros on average!
Retail prices of diesel fuel are also moving in the …stratosphere, as they exceed even 2.50 euros, with Denmark, Finland and the Netherlands holding the “scepter”.
Greece, due to high taxation, has not remained unscathed. The latest data show that with an average price of almost 2.16 euros, it has the 6th most expensive unleaded in the EU, while by keeping the excise tax on diesel fuel at lower levels, it ranks 12th, lower even than the European average of 2.158 euros per liter.