The official maximum price for gasoline and diesel introduced on November 15, 2021, has not significantly boosted fuel consumption. The government must decide by February 15 whether to extend the price cap for another three months.
This article was originally published on our sister-site, Ungarn Heute. Translated by Júlia Tar.
According to the Hungarian Tax Authority (NAV), approximately 155 million liters of gasoline and 321 million liters of diesel were consumed in Hungary in November 2021, representing increases of only 7.9 and 5.2 percent, respectively, compared to the same period last year.
This data indicates that fuel is not considered a particularly price-sensitive product. Although fuel prices had risen from 350 to over 500 forints within a few months before the introduction of the maximum price, less cars were not on domestic roads. This trend has now been reversed as well: just because the price of gasoline became 30 forints cheaper from November, not much more fuel was consumed.
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The gas station operators were not particularly happy about this government measure, as the further development of the Brent crude oil price and the change in the exchange rate of the domestic currency were not foreseeable. Fortunately, however, something unexpected happened 10 days later: as a result of the Omicron variant of the coronavirus, the Brent crude oil price dropped 11.6 percent on November 26 and did not rise above $80 until January 4 either. Currently, however, a rising trend can be observed again, so that the government must consider by February 15 whether to extend the validity of the maximum price for another three months, otherwise fuel prices could explode again.