Drivers in Spain are rushing to the pumps before the fuel discount scheme comes to an end after midnight on December 31
On January 1, 2023, the fuel discount bought in by the Spanish government will no longer exist for the general public. The recent drop in prices, and the end of the subsidy, have caused a greater influx of customers at service stations across the country.
The lowest prices in recent months, and the end of the general subsidy of 20 cents per liter of fuel on December 31, have caused gas stations to have more customers than usual and, in some of them, long queues have formed to refuel.
At the Petroprix station on Avenida Ortega y Gasset, next to the San Luis and La Estrella industrial estates, vehicles were piling up this Friday waiting to fill their tanks. There were even those who added a carafe to make the most of the help and fill the tank cheaper next time as well.
In this particular station, diesel was marked at 1,585 euros per liter and 1,515 euros per liter of gasoline, a substantial price decrease when there have been weeks in which it has come to exceed two euros per liter. Savings for consumers have been substantial these past few days. So much so that the oil company has experienced, on a national level, a sales surge of 30%.
Why fuel is so expensive
There are several factors that can contribute to the cost of fuel. Some of the main factors include:
- Production and transportation costs: Fuel must be extracted from the ground, refined, and transported to distribution centers and gas stations. These costs can vary depending on the location and type of fuel and can affect the final price that consumers pay.
- Market demand: When the demand for fuel is high, the price may increase. Conversely, when demand is low, the price may decrease.
- Government taxes and regulations: Many countries impose taxes on fuel, which can add to the cost that consumers pay. Governments may also regulate the production and distribution of fuel, which can also affect the final price.
- Environmental concerns: Governments and consumers may be willing to pay a higher price for fuel that is less harmful to the environment.
- Political instability and conflict: If a country or region experiences political instability or conflict, it can disrupt the production and transportation of fuel, leading to shortages and higher prices.
- Exchange rates: If a country’s currency weakens relative to other currencies, it may become more expensive to import fuel. This can lead to higher fuel prices in that country.
Overall, the cost of fuel is determined by a complex set of factors that can change over time. The war in Ukraine is an example that cannot be preconceived when factoring in fuel prices.
Read more: Spain to withdraw fuel duty discount but one company bucks the trend