Motorists are hit hard by the reversal of the temporary reduction in excise duty on fuel. The price of petrol will shoot up by 16.7 euro cents on 1 July. “That is €6 to €10 on a full tank,” warns tank price expert Paul van Selms (UnitedConsumers). From 2024, refueling will hurt even more.
Due to the sharp price increase as of July 1, many people will want to fill up their vehicle cheaply just before that deadline. “I expect a run at gas stations then,” says Van Selms. If the oil price remains at the current level, the price of petrol will then rise above the magic €2 mark almost everywhere. Now petrol drivers only pay more than € 2 per liter at certain pumps along the highway. At unmanned filling stations, the price of petrol is on average 20 to 30 euro cents lower.
The Tax and Customs Administration confirms that the excise duty increase including VAT will amount to no less than 16.7 euro cents per litre, but states that gas station operators do not have to take over in full. “Although the levies have a cost-increasing effect, the influence on the final sales price lies with the supplier of the fuels,” said a spokesman.
After the outbreak of war in Ukraine, the cabinet reduced fuel excise duty in April 2022 to accommodate motorists. But that excise duty reduction will be reversed in two steps: as of July 1 and January 1, 2024. Then another 10 cents will be added, so that the highway price at current oil prices shoots up to more than € 2.25. Probably a few cents more, because of the annual inflation adjustment. Last year, the inflation correction amounted to no less than 6 cents. In addition, petrol and diesel will eventually become a few cents more expensive due to the mandatory addition of biofuel, something that climate minister Rob Jetten advocates.
However, Van Selms does not see petrol returning to the record price of almost € 2.51 from June 2022 for the time being. But € 2 per liter is also making a big impact, according to him. “Five years ago, €2 for a liter of Euro95 was seen as an absurd amount. That is now considered normal.”
According to energy expert Ben Woldring (Gaslicht.com), the cabinet’s timing is not ideal to increase excise duty again. The livelihoods of many consumers have already become considerably more expensive due to high inflation and the recent increase in VAT on gas and electricity, Woldring emphasizes. “All of this adds up quite a bit.”
Political choice
Director Arjan Vliegenthart of budget institute Nibud calls the reversal of the excise duty reduction for motorists “a political choice.” He does hope that the cabinet will come up with replacement support measures for people who are experiencing financial difficulties. “This can be done through their wages, for example,” explains the Nibud director.
In addition to the higher excise duty, car owners must also take into account rising prices at the pump due to more expensive oil, warns Van Selms. “The expectation is that the oil price can almost only rise in the near future. The past few months have shown that as soon as the price threatens to fall, the OPEC countries press the button to reduce their oil production. That seems to work quite well for them.” In addition, petrol and diesel will eventually become a few cents per liter more expensive due to the mandatory addition of biofuel.
The price increases will make it more attractive for Dutch motorists to fill up across the border. Van Selms: “But the price differences with neighboring countries are not as great as before. I myself recently drove in Germany. There you pay the main price at gas stations along the highway.”