The executive is currently attempting to keep fuel costs under RON 10 (EUR 2) per liter as the war in Iran continues. The conflict led to the largest weekly increase in oil prices since 1983, triggering panic in global financial markets.
During statements made on Sunday, March 8, Romanian energy minister Bogdan Ivan stated that the government will intervene to keep fuel prices down.
“The state has 5 scenarios on the table, depending on how these developments continue. I presented them to the Finance Ministry as well and discussed them with the prime minister, and we will intervene depending on how the situation evolves,” Bogdan Ivan declared, according to News.ro.
The official noted that the price increase is the largest since 1983, and that current information signals that the trend will continue.
“We are already determined to activate different mechanisms that will do everything possible so that we do not reach a two-digit amount at the pump. […] I believe that next week we will have to make this decision,” the minister added.
According to Ivan, these scenarios involve the state reducing the excise duties and taxes that make up almost 70% of the final price of fuels, “for a limited period of time until we return to normal after this conflict in the Middle East ends.”
He also added that prices in Romania have not gone up as far or as fast as in other EU countries. “We are somewhere at about RON 0.40 extra for standard diesel and standard gasoline, compared to other states, due to our direct intervention, both on supply routes and in the area of combating the abusive and unjustified increase in prices,” he argued.
Oil prices started to climb globally as the US and Israel began bombing Iran, a major oil exporter, earlier this month. Prices climbed even higher as Iran closed traffic in the Hormuz Strait and several energy installations were hit. China, India, Japan, and South Korea are among the biggest importers of oil through the Hormuz Strait, and therefore will be impacted the most.
China alone purchases around 80% of Iranian oil. By comparison, Romania purchases oil from Kazakhstan, Azerbaijan, and Libya.
Energy cost has also gone up in the United States, but the Trump administration has argued that a short-term increase in prices is more acceptable than a long-term threat from a missile and nuclear-armed Iran.
(Photo source: Baloncici|Dreamstime.com)
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