Experts: forint will strengthen, but Hungarian fuel prices will be one of Europe’s highest

The Hungarian forint broke records this week, reaching even 367/EUR. However, experts believe this trend will not last long since the national bank started to cut interest rates protecting the exchange rate. Meanwhile, the Hungarian government plans to increase the excise tax on fuel products, which will cost much more.

According to totalcar.hu, the Hungarian government said they must increase fuel prices from 1 January 2024. Otherwise, the Orbán administration would risk an infringement procedure against Hungary. That is because the EU has a minimum level of tax on each fuel product, and, currently, Hungary does not reach that. Even though Budapest asked for derogation (temporary exemption of the rule), the European Commission rejected the plea.

The result is that fuel in Hungary will cost much more. Here is how the tax will increase:

• Gasoline: below USD 50/barrel from HUF 125 to 157.55; above USD 50/barrel from HUF 120 to 152.55
• Diesel: below USD 50/barrel from HUF 120.35 to 152.9; above USD 50/barrel from HUF 110. 35 to 142.9
• LPG: HUF 95.8/kg remains for road vehicles, while for other purposes, it will rise from HUF 12.725/kg to HUF 14.685/kg
• Electricity: from HUF 310.5 to HUF 358.5 per MWh

In the case of gasoline and diesel, the increase will reach HUF 41 per litre, which is significant. As a result, Hungary will be among the European countries where fuel is one of the most expensive. If that happens, Totalcar suggests refuelling in Croatia, Romania or Slovakia, where it is much cheaper. For example, gasoline is now one of the cheapest in Romania in the continent (HUF 476-495/l).