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Speculators sky rocketed gas prices in Greece

05 March 2010 / 13:03:30  GRReporter
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Speculative spike in fuel prices in Greece followed, after the announcement of the emergency increases in excise duties. For less than day unleaded gasoline prices surpassed €1.55 per liter, as hours before the drastic increase the price was around €1.23 per liter. On March 3, 2010 the government announced it would increase the implicit tax on fuel by eight Euro cents. With the increase in VAT from 19% to 21% the total appreciation of one liter of gasoline did not pass the ten Euro cents increase for the end user. 

However, several hours after the official publication of the emergency measures the prices of petrol sky rocketed. Instead of an increase of ten Euro cents (as the new measures provided) the final price of gasoline per liter jumped with about €0.25. It should be noted that in February of this year the government announced the first increase in excise duty by about 12 Euro cents, before which the petrol cost per liter was €1.09. 

The lack of a price ceiling enabled gas stations owners to make quick profit in the days following the announcement of additional economic measures. The mass hysteria that life in Greece is instantly becoming more expensive came as a justification for the speculative inflation of fuel prices. 

Meanwhile, officials from the commercial department of the Ministry of Finance conducted a series of meetings with various representatives of the business circles in the country to ensure the smooth introduction of the new VAT increase. The purpose of these meetings is to avoid further speculation in the prices of the first need goods.  Besides fuel, prices subject to speculative manipulation are food products, detergents and transport services. In the tense socio-economic situation in the country, some trade organizations take rapid steps to try and adapt. Piraeus Chamber of Commerce announced that it will give special user cards to all public employees and pensioners, members of the union, who wish to take advantage of some special discounts in stores.

Tags: Greece Economic crisis gas prices VAT increase
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