Double ‘hat’ on liquid fuel, but there is no room for intervention

By Tasos Dasopoulos

Liquid fuels – and especially gasoline and diesel – have now doubled due to the slipping of the euro exchange rate close to 1: 1 against the dollar and the rise in international crude oil prices, as admitted by competent sources of the Ministry of Finance. .

They acknowledge, however, that after the recent € 3.2 billion intervention announced, there is currently no room for new interventions to stem the tide, mainly in liquid fuels, despite the fact that the average price of petrol has now reached 2 , 2 euros. Despite the good performance of the revenues for the first four months, which exceeded the budget target by 1.8 billion euros, the same sources stressed that no intervention can be made without further increasing the deficit for this year.

They also make it clear that the only measures that the Ministry of Finance can take and have an effect on prices have a budgetary cost and this can not be done at the moment, while there is no intention to impose a ceiling on fuel prices as has happened in the past. .

In fact, at the level of further interventions, they show the Ministry of Development, implying more intensive controls to deal with phenomena of scandalous profits.

They even leave open the possibility that the slide of the euro will continue due to the difference in monetary policy pursued on both sides of the Atlantic. They point out that there is a different approach to inflation that the European Central Bank and the US Federal Reserve (Fed) have. In particular, they note that the Fed considers that high inflation in the US is not only a result of international prices but also endogenous problems of the country’s economy. That is why it has a more aggressive policy in raising interest rates. On the contrary, the ECB considers that the problem of inflation is external and that is why it will have a milder policy in raising its interest rates.