The Hungarian government has capped the price of fuel last year in November. Due to the regulation, the price of fuel had been HUF 480 (EUR 1.13) for almost a year now. Since the start of the new rule, many gas stations had to close and a lot of modifications were implemented. Even with the 20-litre daily limit at most stations, the diesel reserves started to deplete. It is feared that the country will run out of it soon.
According to Portfolio.hu, only about one to two weeks’ worth of fuel still remains in the national safety reserve. The Hungarian Hydrocarbon Stockist Union (MSZKSZ) has sold a huge bulk of the reserve leaving only a little amount left. The MSZKSZ makes a monthly report about the petroleum, natural gas, petrol, kerosene and fuel reserves of the country. The fresh data is still to be reported, but from the last one, it was concluded that the nation has almost no fuel left.
Since February, diesel reserves have been steadily decreasing. By the end of August, the total reserve was about 243.1 kilotons and at the end of September, the MSZKSZ had sold about 180 million litres. Doing the calculations, the remaining amount is about 63.1 kilotons or 75 million litres.
Infering from the data of the first half year, this amount is only enough for about 10 days.
In February, there were still about 500 kilotons of diesel in the reserves. By the end of the summer, this was halved. In the case of petrol, the fall was not so drastic. It fell from about 265.2 kilotons from the end of January to about 173.2 kilotons. But petroleum reserves are still holding up pretty well. Those have even increased from 614.3 kilotons at the end of January to 704.6 kilotons in August.
The regulation states that the strategic reserves must be enough for 90 days, calculated by the net import of the nation. Even at the end of the summer, this number was only 73 days and the diesel reserves had only fallen since then. This is a thirty-year low point in terms of fuel reserves.
It is well-known that the capped price of fuel leads to supply chain problems. The government had been warned by more and more experts that these actions will have serious consequences. The original regulation was limited to privately owned vehicles, taxis and to certain agricultural machines. This limitation was introduced because nobody wanted to export fuel to Hungary, when they could only sell fuel at a below-average price.
The problem is further exacerbated by the price of natural gas. Diesel is cheaper than natural gas as of now and many industries switched to using it instead of natural gas, due to their similar heating value.
Featured image: illustration
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