Cyprus fuel price volatility and government response

In mid-August 2026, the Cyprus Consumers Association raised concerns regarding significant increases in retail fuel prices. The Association noted that heating oil prices had risen by approximately 50% since March, while gasoline and diesel saw increases of 21% and 26%, respectively. Association president Mario Drousiotis questioned if geopolitical developments in the Middle East fully justified the extreme price levels and called for better monitoring.

By late August, the Council of Ministers responded to energy market volatility linked to the Middle East conflict by implementing temporary tax and fund relief on fuel imports. From August 27 to September 2, 2026, the government waived customs duties, pier fees, and certain fund contributions for various fuels, including gasoline, diesel, and aviation gasoline, in an effort to limit increases in pump prices. This included removing a 1% premium on the CIF value for diesel and eurodiesel imports and suspending contributions to the Tourism Development and Promotion Fund and the Price Stabilization Fund.

By early September, concerns emerged that fuel prices may rise again due to increasing international oil costs and the impending expiration of tax relief. Christodoulos Christodoulou, Vice President of the Cyprus Petrol Association, noted that global oil prices have risen from approximately $80 to between $90 and $91 per barrel. He warned that if the government does not renew the reduced special consumption tax by September 17, prices for 95 and 98 octane gasoline and diesel could increase by 8.33 cents per liter, potentially driving diesel prices toward €2 per liter. While the government evaluates an extension, the association reports that fuel supplies remain adequate.