Oil and gasoline prices are trending upward, as Christodoulos Christodoulou, vice president of the Association of Gas Station Owners, told KYPE, noting that fuel prices have not yet peaked and that there may be small increases of around 2–3 cents within the week.
Regarding price trends, he stated that forecasts do not indicate a decline in the near future. “The forecasts indicate that we won’t see anything in the near future that would lead to a decrease in fuel prices,” he said.
When asked what this assessment is based on, he said it stems from the Association’s experience and the trend in international oil prices. “For several days, oil has been hovering around $108–109, and we believe that prices corresponding to these levels have not yet been reflected in the market,” he said.
ΣΧΕΤΙΚΑ ΑΡΘΡΑ
Mr. Christodoulou added that the Association’s estimates are based on refinery prices in Greece and prevailing market conditions. “We’re also monitoring the refineries in Greece—what prices they’re selling at and what the situation is like—that is, whether they’re selling at high or low prices at gas stations, since that’s where they buy directly from the refineries. We draw conclusions based on this information,” he said.
Higher and Lower Prices for Diesel and Gasoline
As he noted, fuel prices are currently at their highest level. According to data from the Consumer Protection Service’s Fuel Price Observatory, the average price for diesel across Cyprus is €2.028, the lowest is €1.939, and the highest price nationwide has climbed to €2.126. Meanwhile, the average price for 95-octane unleaded gasoline across Cyprus is €1.744, with the cheapest at €1.659 and the most expensive at €1.819.
As for heating oil, the average price across Cyprus is €1.666, the cheapest price is €1.529, and the most expensive price is €1.769.
As Mr. Christodoulou noted, some gas station owners have raised prices even higher, though he pointed out that not many stations are doing so. Regarding heating oil, he stated that with the subsidy, the price will drop to 1.63, but he expressed the view that prices may rise further by November 1.
When asked about gas station owners’ profit margins, he said that they, too, are facing significant difficulties due to the increase in fuel purchase costs. “Gas station owners are struggling just as much as consumers are right now—perhaps even more. We used to buy a shipment for around €40,000, and now we’re paying €65,000. So, we inevitably need additional capital,” he said.
He added that, with an average of two shipments per week, a gas station owner needs approximately €50,000 in additional capital each week. “There are difficulties. There are far too many gas station owners who cannot cope with this problem,” he noted.
As for the profit margin, he said that for the vast majority of gas station owners, it amounts to about 5 cents per liter. “If we calculate it as a percentage, it’s about 2.8% gross. The profit margin for gas station owners is very small,” he said, clarifying that the profit margin is higher for those who own their own stations.
At gas stations charging €20
When asked about consumer behavior, he noted that people visiting gas stations these days are being very frugal. “People are very careful with their spending and try to avoid unnecessary trips,” he said, explaining that they fill up with small amounts, such as 20 euros, which is equivalent to 12 liters of gasoline and 10 liters of diesel. He attributed the heavy traffic flow to the occupied territories over the past three months to the high fuel prices. “Hence the lines heading toward the occupied territories; we are constantly seeing the flow toward the occupied territories grow,” he said.
Referring to the measures the government could take, the Vice President of the Gas Station Owners Association said that when the price of gasoline was €1.20 per liter, the state collected 19 cents in VAT, whereas now that the price is close to €1.90 to €2, it collects 32 cents. “The government could use this difference to subsidize the public,” he said, citing Greece as an example and noting that “heating oil in Greece is subsidized by 15 cents per liter, while here it’s only 5 cents.”
Disproportionate price hikes and support, says the Consumers’ Association
Given the difficult economic situation consumers face today, any assistance, big or small, is welcome, said Marios Drousiotis, president of the Cyprus Consumers’ Association, who, speaking about fuel price trends, noted that “we are sailing into the unknown on a boat called ‘hope,’” adding that “what we expect is that we won’t see any price reductions.”
Regarding the measures announced by the government, he pointed out that there are specific aspects with which the Association is dissatisfied, particularly the heating oil subsidy, noting as first, the decision that the subsidy will take effect on November 1 and not immediately. He also said that from March 1 to the present, the price of heating oil has risen by 71 cents per liter. “This is a huge increase,” he said, adding that “the government stepped in and provided a 6.3-cent subsidy.”
He explained that the 6.3 cents result from a 5.3-cent tax reduction, to which 19% VAT is added, resulting in a total benefit for consumers of 6.3 cents. “Subtracting 6 cents from 71 cents is a drop in the bucket for consumers. The increase is enormous,” he said.
As he noted, the Association had submitted this specific proposal at least three weeks ago, warning of the 71-cent increase from March 1 to the present. He added that, on top of this increase, the government is collecting 13.5 cents per liter more than it was on March 1.
“As an Association, we say that, since heating oil has seen the largest increase of all petroleum products, the government should, in some way, return this additional revenue—which it collects solely on the price increase—to heating oil consumers,” he said.
As a third point of disagreement regarding the measures announced by the government, Mr. Drousiotis referred to the reduction of the VAT rate on the cost of installing photovoltaic systems from 19% to 9%.
He added that the average installation cost amounts to €5,000 and, therefore, the benefit for new consumers who install photovoltaic systems from now on amounts to approximately €500. He noted, however, that the government has abolished the Net Metering program, resulting in consumers being forced to switch to Net Billing.
Mr. Drousiotis noted that, based on the Association’s calculations, the government provides €500, but will collect more from consumers over the 15-year term of the contract. “It is a subsidy, but you’ve taken away other benefits from consumers,” he said.
He also noted that for diesel and gasoline, there is a total reduction of 8.33 cents through the end of November.
He added that more relief could be provided on fuel prices, noting that the biggest concern is the very small subsidy for heating oil, which took effect on November 1.
He also mentioned that, since April, the Association has been asking the Ministry of Finance and the Ministry of Energy to ensure that any subsidy granted for heating oil, whether small or large, would reach consumers and not end up elsewhere—as, according to him, happened in April with the 8.33-cent subsidy. “It didn’t all go to consumers, because it’s up to the gas station owner whether they want to lower the price,” he said.
Mr. Drousiotis also referred to a survey conducted by the Association in April, which showed that 19 gas stations did not lower their prices at all, and another 97 implemented a reduction of less than 8.33 cents. “We brought this to their attention, and they told us it’s not illegal,” he said, adding that, as long as this isn’t enshrined in law, this loophole remains open.
He emphasized that it must be ensured that the reduction is implemented and reflected in gas station prices.
When asked if they are satisfied with the measures being implemented for motor fuels, he stated that the subsidy should be higher or that another way should be found to provide more assistance to the public.
When asked whether calculations had been made regarding the cost of basic motor fuels and a household’s monthly expenses, he simply noted that they are certainly rising, given that, as of March 1, the price of gasoline has risen by 40.5 cents and diesel by 61 cents.
Source: CNA
