Latvia plans fuel price reductions via tax cuts

The Latvian government is planning measures to reduce fuel prices to the 'allowable minimum' through various fiscal tools. Prime Minister Andris Kulbergs announced that the proposed solutions include reducing excise taxes on fuel, eliminating costs associated with fuel reserve requirements, and removing biofuel mandates.

These measures could potentially lower fuel prices by up to 20 cents per liter. The government aims for these price reductions to be in effect from October 1 to December 31. The Cabinet of Ministers plans to move these proposals to Parliament this week.

Kulbergs noted that rising fuel costs are a significant issue for Latvia and Europe, impacting private transport, public transit, aviation, logistics, and emergency services. He also highlighted that fuel price increases contribute to inflation and reduced purchasing power. Regarding diesel, the Prime Minister pointed to global refining capacity issues and noted that diesel prices are largely driven by international 'Platts' indices rather than direct crude oil exchange prices.