Heating oil prices expected to exceed €1.90 per litre

Greece is bracing for a potentially expensive winter as heating oil prices are projected to rise above €1.90 per litre when the new heating season begins, amid elevated international oil prices and heightened geopolitical uncertainty.

The Greek government is increasingly concerned about the outlook for liquid fuel and natural gas prices, as international energy markets remain vulnerable to supply disruptions and geopolitical developments.

With Brent crude trading around $100 per barrel, analysts' forecasts suggest that the starting price of heating oil in Greece could exceed €1.90 per litre. The government is therefore examining measures to limit the impact of higher energy costs on household budgets.

Concerns are being compounded by the sensitivity of global oil markets to ongoing conflicts and geopolitical tensions. If supply is further restricted and the more pessimistic scenarios outlined by analysts materialize, international crude prices could climb even higher, putting additional upward pressure on fuel prices in the Greek domestic market.

Against this backdrop, three main options are reportedly being considered to protect households from rising heating oil costs.

Direct subsidy at the pump

The first option involves introducing a direct subsidy at the pump. Such a measure would immediately reduce the retail price paid by consumers when purchasing heating oil. It could provide a buffer against a sharp increase in international oil prices, although the scale of the intervention would depend on its fiscal cost.

Changes to the heating allowance

The second scenario involves modifying the existing heating allowance mechanism. The aim would be to adapt financial support to the new conditions in the energy market and potentially revise the allowance criteria to provide more effective assistance to households facing the greatest increases in energy costs.

Agreement with refineries

The third option reportedly involves an informal agreement with refineries. Under this scenario, the discount currently applied to diesel fuel could be extended to heating oil, with the refining industry absorbing part of the cost in an effort to keep the final retail price under control.

The government's final decision is expected to depend largely on international oil prices and the available fiscal room. As the start of the heating oil season approaches, pressure is mounting on authorities to establish an effective mechanism to shield households from a potentially significant increase in winter heating costs.