The last couple of days saw mass hysteria and ramping panic buying at Hungarian petrol stations, which were triggered by the fake news that the price cap would end at midnight on 2 December. Huge crowds of people flooded the gas stations on Friday afternoon in hopes of getting fuel for a price of HUF 480 (EUR 1.16).
According to RTL.hu, long queues formed at gas stations on Friday afternoon, when the news broke out about the end of the price cap. However, it all turned out to be false. According to recent reports, the government extended the fuel price cap until 31 December. The hoax rapidly caused nationwide fuel shortages so many people were left with empty tanks for the weekend. The distressed customers would drive from station to station in the bid to find a few drops of petrol but their efforts were mostly in vain.
Hungarian refinery in trouble
Gergely Gulyás, the current Minister of the Prime Minister’s Office, stated that if the Hungarian refinery, MOL, was unable to provide a sufficient amount of fuel supply then the government would have to take further action. He said that
the situation was rather worrisome as the country was about to face a serious fuel crisis
unless immediate changes were made. There was no clear answer from MOL as to whether they could ensure a sufficient fuel supply. They replied though that all of their employees were working on the issue in full swing.
Although Hungary was exempted from the Brussels oil sanctions, certain factors further complicate the situation. The above-mentioned sanctions will enter into force at the beginning of December and will prevent countries from trading Russian oil among themselves. This means that not even MOL’s refineries in Százhalombatta and plants in Bratislava are allowed to do business. Russian threats to stop fuel deliveries, which would force Hungary to switch to sea transportation, are posing an additional hazard.
Ending the price cap
The problem with the fuel price cap is that it creates supply chain issues because no one is selling fuel as cheaply as MOL does, so the whole process becomes unsustainable. According to energy experts, the price cap should have been abolished a long time ago to maintain the stability of the country’s supply.