Apart from sustained high prices for crude oil, new government proposals to increase excise duties are expected to up the pressure on prices at the pump.
This spring, petrol was 10 -15 percent more pricey that during the same period last year. Today consumers are forking out €1.57 for a litre of 95-octane petrol and €1.36 for a litre of diesel fuel. According to Neste oil Retail Sales Director Arvo Ruotsalainen, motorists can expect more of the same this summer.
”I believe that this will continue as it has done during the spring. The price of oil has see-sawed up and down about 15 dollars in either direction,” he noted.
However, it’s difficult to make firm predictions, because of the large number of intangible factors that feed uncertainty. The price of crude oil is affected by issues such as political unrest in oil-producing countries, uncertainty about the global economic outlook and questions about the stability of the euro.
Over the past year, the price of crude oil increased by over 70 percent, from 70 dollars to 120 dollars per barrel.
Excise duties will show up at the pump
Part of the new government programme is expected to include an increase in excise duties. According to Ruotsalainen, any such increase would be reflected in higher prices at the pump.
“The excise tax will be added on top of the value added tax, which means there’ll be a tax on a tax. In practice, in these kinds of low margin sectors, taxes are inevitably applied to consumer prices. Taxes are currently so high that they account for early one euro of the total litre price for petrol,” he added.