"The current fuel price caps are acceptable," said Konstantinos Ka, noting at the same time that the increase in Cyprus is certainly lower than the EU average. For their part, Members of Parliament are calling for the formula used to determine the final fuel price and for support measures from the government.
Speaking before the parliamentary Energy Committee, which examined on its own initiative the rise in fuel prices and its impact on the economy and Cypriot citizens in general, he noted that currently, price fluctuations are occurring throughout the European Union; therefore, we must evaluate prices in Cyprus based on what is happening at the European and international levels, rather than in isolation.
ΣΧΕΤΙΚΑ ΑΡΘΡΑ
The Director of the Consumer Protection Service added that price data in Cyprus show that price trends in Cyprus are comparable to those in the European Union “and in some—and indeed many—cases, the increase in Cyprus is certainly lower than the EU average,” noting that Cyprus is currently below the EU average.
Therefore, he noted, despite the burden that Cypriot consumers are certainly facing—and they are certainly in a difficult situation— “we must not create the impression that Cyprus is a special case of uncontrolled price increases.”
Mr. Karagiorgis pointed out that the government systematically monitors fuel prices through the Special Consumer Protection Service to maintain a comprehensive overview of the market. He went on to note that, with regard to the formula, the monitoring model has been modernized, and he noted that as of September 1, modern econometric models are now being used, which systematically track all prices on a daily basis by automatically retrieving all daily price data from Platts, the exchange rate set by the European Central Bank, as well as companies’ import data and retail prices from all gas stations.
“So we have an econometric model that takes into account historical data from 2020, as well as imports, purchases, transactions made by our companies to determine whether the prices currently being charged are acceptable or not,” he added.
He noted that the Agency cannot intervene in the market without restraint, as he mentioned. “We use certain models, from specialized firms, which helped us set them up, and based on these models, we see that the prices currently in effect in Cyprus—taking into account all the data available throughout the import chain—are acceptable,” he said. He added that when the Agency determines that prices exceed the acceptable threshold, it takes the necessary measures.
Mr. Karagiorgis continued by saying that “this is a strange period right now, as prices are certainly very high, but even so, prices in Cyprus today are comparatively much lower than in the EU, noting that Cyprus ranks 4th or 5th in Europe for the lowest prices on 95-octane gasoline and has very low prices for heating oil.
The Consumer Protection Service’s reports prompted reactions from Committee members, who requested details on the formula used to calculate fuel prices, information that, however, was not provided by the representatives of the relevant agencies.
In fact, the Committee Chair, DISY MP Nikos Georgiou, noted in remarks following the committee meeting that today, three relevant government agencies were unable to present the formula and clearly specify the tax burden on consumers. “Regulatory authorities have an obligation to conduct preventive audits to ensure the market operates transparently. That is why the state must have the answers, especially regarding the obvious. It is a matter of transparency in oversight and sound policy,” he said. He noted that the discussion on this issue will continue at the committee’s next meeting on October 27.
Gas Stations Did Not Lower Prices After the Subsidy, Say Consumers
Taking the floor during the committee discussion, Marios Drousiotis, president of the Consumers’ Association, argued that the competent authority is not monitoring the situation closely, citing examples that while the fuel subsidy was being implemented, the Agency reported that “the subsidy proceeded smoothly without distortions.” We, who were monitoring the situation, saw that 19 gas stations did not lower their prices at all, and 97 gas stations lowered them by less than 8.33 cents per liter. We have the names, the dates, and the amounts, and we believe the agency did not monitor the situation closely,” said Mr. Drousiotis.
He also called for the release of data on international prices and the economic model used, noting that “they don’t even provide it to Parliament.” At the same time, he submitted a table showing current prices and pre-war prices, the additional government revenue, and a comparison with the subsidy announcement on March 26.
In response to MPs’ remarks that the Consumer Service’s reports were the same in 2022 as well, Mr. Karagiorgis stated that “we, as a government, are doing everything possible to safeguard consumers’ interests.” He continued, saying, “If nothing has changed since 2022, I will keep repeating the same thing until 2030. If we find anything, rest assured that we will follow up,” he said. Responding to a question, he also noted that the excise tax on 95-octane unleaded gasoline was 42 cents, and following the excise tax reduction, it is now 35 cents.
The Competition Protection Commission noted that, for the commission, the crucial question is whether prices are set freely by companies or are the result of some kind of collusion or practices among companies that aim to—or, I believe, result in— restriction of competition.
It was noted that uniformity in prices does not constitute evidence of any kind of collusion, and the importance of daily price monitoring—which is distinct from the competition authority’s role and serves a complementary.
EPA Investigation into Fuel Prices Underway Since 2024
The EPA spokesperson added that any evidence suggesting collusion or practices falling within the commission’s jurisdiction will be forwarded in a timely manner. She noted that the commission has conducted investigations in the petroleum sector and assured that the commission is monitoring developments in the fuel sector. He referred to investigations conducted by the EPA in previous years and, in particular, to a 2014 investigation that covered all stages of the supply chain.
In response to Mr. Georgios’s remark that the market has changed since 2014 and whether the Hellenic Competition Commission considers it appropriate to conduct a new investigation, the spokesperson stated that a study had been launched in 2024 and is still ongoing.
In response to a question directed at the Ministry of Finance regarding current fuel prices, what percentage the government collects, what the excise tax is—whether in the form of VAT or other fees—and to what extent the increase in fuel prices, the imposed VAT, essentially nullifies the tax relief granted through the special excise tax in April 2026, the Ministry spokesperson stated that further data would be needed to answer the question.
She added that for petroleum products, excise tax revenue over the eight-month period had decreased by 16.5 million compared to the same eight-month period last year due to the reduction in excise tax.
Assistant Tax Commissioner Christos Karoullas merely noted that the tax department’s net revenue from VAT has not increased (input tax and output tax). For 2024, 32 million; for 2025, the same amount; and proportionally, the same for 2026 (24 million so far).
The Chairman of the Fiscal Council, Andreas Charalambous, stated that he has prepared an inflation assessment, which has been posted on the website and will be sent to committee members, and expressed his readiness for dialogue.
He noted that inflation in Cyprus is imported and observed that during periods of energy crisis, price increases in Cyprus are disproportionate, which indicates that we have not made much progress in field of renewable energy and are overly dependent on conventional sources; that is why, in 2026, Cyprus—once a country with relatively low inflation—ranks third.
He added that from a fiscal perspective, if inflation rises, one must recognize that while the state benefits initially, this advantage may eventually be offset. Regarding the government’s countermeasures, he noted that targeted spending is preferable to tax cuts, pointing out that the latter primarily benefit high-income earners.
Reactions from Members of Parliament
The statements from the relevant government agencies did not satisfy the committee members.
Mr. Georgiou noted that the relevant government agencies were unable to accurately present the formula used to determine the final price of fuel at the pump, adding that “Instead, the Members of Parliament had to perform the relevant numerical analysis themselves.” He added that regulatory authorities have an obligation to conduct proactive audits to ensure that the market operates with transparency and healthy competition.
“The state must have the answers, especially to the obvious questions,” he said.
For his part, AKEL MP Andreas Pasiourtides noted that he was referring to the government’s responsibility, which, as he pointed out, is not limited to having the relevant agencies come and saying that, given how prices are shaped by international developments, they are acceptable. “What we are seeking is for the government to take measures,” he said.
He reiterated AKEL’s positions regarding relief for businesses and households from the rise in fuel prices, such as a targeted allowance for families with children and the abolition of double taxation—“a demand that goes back many years” but has not been pursued, as he noted.
He added that AKEL’s proposals also include more effective price controls and a transparent method for determining the profit margins of fuel companies, as well as income-based supportheating oil, as well as “a reduction in the vehicle registration fee for low- and middle-income groups—the proposals are there; we do not overlook the fact that some measures have been taken, but they are clearly not enough.”
Responding to a question regarding the breakdown of prices at gas stations, he said that today the average price of heating oil is 2.028, noting that all agencies should be aware of the components of this price. He said that one-third of the retail price consists of taxes and fees. He noted that for an average fuel price of 1.50, 45%–50% corresponds to taxes.
ELAM MP Linos Papagiannis noted that most other countries have alternative modes of transportation that do not exist in Cyprus. He added that by managing the situation, the government has generated revenue that goes into the Republic’s general fund.
“The measures have been received positively, but they are not enough. There needs to be more effective support for the people.” He questioned whether there is an investigation into the loss of state revenue due to increased flows to the occupied territories, as well as what the price of heating oil and gasoline was before the war began.
In remarks made after the committee meeting concluded, he noted that the most fundamental question—how fuel prices are determined in Cyprus—remains unanswered, what tax revenue the government collects from fuel prices, and why it is considered acceptable to compare Cyprus’s prices with those of other countries.
DIKO MP Adamos Aspris stated that the cost of fuel is a complex equation. “We are going through a period of an unprecedented crisis,” he noted, adding that “we now need new, out-of-the-box ideas,” while noting that there is also a need for “expertise, if deemed necessary, from other entities and abroad.” She noted that the approach we currently use to manage such a situation is proving to be insufficient, adding that a more effective management strategy is urgently needed.
For her part, Alma MP Irini Charalambidou pointed out that comparisons are inappropriate, as other governments provide their citizens with means of transportation. She noted that fuel prices in Cyprus have always been sky-high. “The EPA has always turned a blind eye, whether due to quorum issues on the board or for other reasons, and today Cypriot citizens cannot even fill up their cars. Cypriot citizens have no other options, and the governments bear responsibility for this,” he noted.
Speaking on behalf of Direct Democracy, Yiannis Laouris stated that the government is collecting approximately 100 million euros because the cost of electricity and fuel is rising, and “whenever it suits them, they provide subsidies. We are not against subsidies, but we are in favor of a just society.”
Source: CNA
