Fuel prices in Poland to rise sharply on Sept. 1: queues form at gas stations

On Sept. 1, Poland ends its CPN ("Fuel prices lower") government program, which included a reduced VAT rate and caps on retail gasoline and diesel prices. Analysts expect fuel could rise by 0.60–0.90 zloty per liter after the measures expire.

On the last day of the discounts, drivers flocked to stations to refuel at lower prices. Queues formed at some stations, and some ran out of gasoline and diesel.

The rush was particularly noticeable in Zakopane. On the evening of Aug. 31, only small supplies of Pb98 gasoline and diesel remained at the largest Orlen station in Ustup. One BP station ran out of fuel, and inventories were falling fast at others. Similar situations were reported elsewhere.

Fuel prices before the hike

Aug. 31 is the last day of Poland's reduced fuel VAT rate of 8% instead of the standard 23%. The government also sets maximum retail prices.

For the final days of the program, the following price ceilings apply:

• Pb95 gasoline — 6.64 zloty per liter;
• Pb98 gasoline — 7.46 zloty per liter;
• diesel fuel — 7.31 zloty per liter.

From Sept. 1, VAT returns to 23%, and caps on gasoline and diesel prices expire. Market participants estimate this will push retail prices up by about 60–90 groszy per liter.

Thus, for a full 50-liter tank, drivers could pay about 30–45 zloty more if the projected increase fully reaches the pump.

Program lasted only two weeks

The Polish government launched the latest CPN phase on Aug. 17 in response to rising fuel costs due to global oil market tensions. It cut VAT from 23% to 8% and required stations to observe daily price caps.

Prime Minister Donald Tusk estimated the tax cut at about 0.90–1 zloty or more per liter of fuel when the program started.

According to the Polish Finance Ministry, all CPN phases cost the budget about 4.7 billion zloty. The extra VAT cut for Aug. 17–31 was estimated at roughly 495 million zloty.

Sources: Rzeczpospolita, Polish government