Why are petrol and diesel increasing? Is it just the fault of excise duties?

The effect of the excise cut stop is starting to be felt: fuel prices are rising, with petrol in self-service exceeding 1.8 euros and diesel soaring towards 1.87, while on “service” we are just under 2 euros for petrol (1.95 euros/litre) and already over for the diesel (2.02 euros/litre). In addition to the effects of the farewell cut in excise duties, the increase in the price lists at the end of 2022 is added, which led to an increase of about 2 cents per liter. As regards excise duties, from 1 January 2023 the rates prior to 21 March 2022 were restored, which translates into an increase of 18.3 cents per liter on petrol and diesel and 3.4 cents per liter on LPG.

1) How much does fuel cost now?
According to the data of «Staffetta Quotidiana», published on 3 January, self-service petrol is at 1.803 euros/litre (+71 thousandths, companies 1.807, white pumps 1.791), diesel at 1.865 euros/litre (+71, companies 1.868 , white pumps 1,855). Gasoline in served mode is at 1.951 euro/litre (+62, companies 1.986, white pumps 1.869), diesel at 2.015 euro/litre (+62, companies 2.048, white pumps 1.931). While the LPG served is at 0.791 euro/litre (+11, companies 0.801, white pumps 0.777), the methane served at 2.394 euro/kg (+45, companies 2.394, white pumps 2.395) and LNG at 2.443 euro/kg ( +102, companies 2.483 euro/kg, white pumps 2.404 euro/kg).

2) Why have petrol and diesel prices increased?
The causes of the increase in petrol and diesel prices are commonly attributed to the war in Ukraine. But the cost of fuel had started to rise well before the Russian invasion of February 24, 2022, which, however, further aggravated the situation. Among the factors that have led to the soaring costs of diesel and petrol is the increase in the price of Brent, i.e. the oil extracted in the North Sea. The run in the price of crude oil in 2021 was a consequence of the post-Covid economy rebound, which was very strong in the face of a supply of gas, oil and coal reduced by the investment cuts that began in previous years. During 2022, on the other hand, the initial increase in the price of oil was followed by a downward phase, also the result of the Chinese Zero Covid strategy. Beijing is in fact the first importer of crude oil in the world. For 2023, experts expect new increases in prices.

3) When was the excise cut decided?
The reduction in excise duties on fuel was introduced for the first time in March 2022. The Draghi government had reduced excise duties on petrol from 73 euro cents per liter to 48 cents per litre, those on diesel from 62 cents to 37 cents per litre. and those on LPG from 27 cents to 18 cents per kilo, initially only from 22 March to 21 April. The measure was then always reconfirmed until 18 November 2022. Even the Meloni government initially extended this intervention until 31 December 2022, but for the month of December it reduced the discount to 15 cents per liter (and no longer 25) on petrol and diesel and 5 cents per kilo (and no longer 9) on LPG.

4) Why did the Meloni government decide not to renew the measure?
The government has chosen not to confirm the cut in excise duties for budgetary reasons as well as for political choices, which have led it to favor other interventions. It is in fact a costly measure: around 7 billion euros were needed to cover the discount from March to December. Furthermore, in the last months of 2022 the price of oil fell compared to the peaks that had prompted the Draghi government to cut excise duties.