Czech Government to Discuss Reinstating Price Controls on Petrol and Diesel

Diesel at Czech filling stations now costs more than 48 crowns per litre on average — higher than in spring, when authorities first introduced price regulation. That's according to Deputy Prime Minister and Minister of Industry and Trade Karel Havlíček, who said a final decision on possibly reinstating price controls will be made next week.

He noted that the situation now differs from spring, when the problem could be resolved quickly through petrol station operators. This time, refinery margins have surged sharply across Europe due to reduced processing capacity. Havlíček pointed out that current prices are still slightly below 2022 levels under the government of Petr Fiala, but factoring in nearly 35% inflation since then, the equivalent of those prices today would be 60–70 crowns per litre. "This is a threshold we cannot afford to wait past," the deputy prime minister stressed, adding that the Czech Republic is holding intensive consultations with neighbouring countries. Possible measures under consideration include setting a maximum margin for fuel sellers and cutting the excise tax on diesel.

Gas Prices and the Threat of a New Energy Crisis

Havlíček warned that Europe has effectively already entered another energy crisis. A month ago, a megawatt-hour of gas traded at 60 euros on the exchange; now it's around 80 euros — a third more expensive — driven by the ongoing conflict in the Middle East.

He said the Czech Republic itself faces no gas shortage risk: the country's gas storage facilities are 74% full, placing it among the top seven in Europe by this measure, and Europe as a whole isn't critically dependent on Middle Eastern gas thanks to its developed infrastructure for receiving liquefied natural gas (LNG). However, the price increase is already baked into long-term contracts and will fully show up next year — the upcoming heating season will already be affected, though the timing of price fixing varies among different consumers and traders.

Havlíček also flagged rising electricity prices, which in Europe are tied to gas prices, as a worrying sign: on Wednesday, a megawatt-hour of electricity on the day-ahead market cost around 160 euros. He also pointed to the gap with the United States, where gas trades at around 8.5 euros per megawatt-hour — nearly ten times cheaper than in Europe.

Criticism of EU Climate Policy

The deputy prime minister sharply criticized the European Union's decarbonisation policy, calling it "completely unreasonable" under current circumstances. In his view, Europe should immediately abandon plans to introduce an emissions quota system for households (ETS2), which would push heating and fuel prices even higher, and should suspend the existing quota system for large industrial enterprises, at least in some sectors.

Havlíček said the Czech Republic has full mutual understanding with Bulgaria on this issue, and is also in talks with Italy and ten other European countries. He also commented on an adjustment to the household quota system approved by the European Parliament this week, which is meant to stabilize quota prices by releasing additional permits onto the market if the price exceeds a threshold of 45 euros in 2020 prices. According to the deputy prime minister, this measure isn't enough: "It's sugar-coating a sour pie and trying to convince ourselves it'll turn into a delicacy. Either way, rising fuel and gas prices right now cannot be taken lightly — the only task for responsible politicians in Europe is to find ways to soften the impact of rising gas, electricity, and fuel prices."

Source: novinky.cz