The Government of the Republic of Croatia adopted today a new Regulation on determining the highest retail prices of oil derivatives, as a direct response to the dramatic increase in crude oil prices on the world market.
The main driver of this instability is the war in Iran, which resulted in the closure of the strategically important Strait of Hormuz. Since approximately one-fifth of the world’s total oil supply circulates through this passage, the price of a barrel has reached the level of around 107 dollars, which is directly reflected on the European and domestic markets – so fuel prices in Croatia will be limited again.
Avoided price shock
The authorities emphasize that a timely reaction is necessary in order to prevent a chain growth of costs. With these measures, which also include changes to the decree on the amount of excise duties on energy products and electricity, the Government is trying to amortize external shocks that, without government intervention, would have led to a drastic increase in the price of all types of fuel at gas stations throughout the country – thus we are returning to the situation from previous years, when the price of fuel in Croatia was regulated. That practice was abolished last summer.
Data show that without government intervention, the price of Eurodiesel would be 1.72 euros per liter from tomorrow. After the new measures, the increase will be limited to seven euro cents, so the final retail price for citizens will be 1.55 euros per liter. The current price of Eurodiesel without additives is 1.48 euros, which means that a jump of 24 eurocents per liter that would have occurred in the conditions of a completely free market has been prevented.
The situation is similar with Eurosuper, whose current price is 1.46 euros per liter. Without government measures, the price of this derivative would jump to 1.55 euros, while with the application of the new Regulation, it will remain at the level of 1.50 euros per liter from tomorrow. Government measures will also limit the price of blue diesel to 0.89 euros, as well as liquefied petroleum gas in tanks (to 1.70 euros) and in bottles (to 2.40 euros).
