In a special government info session, Minister Gulyás and Zsolt Hernádi, CEO of MOL, announced that the annulment of the fuel price cap would come into effect starting Tuesday at 11:00 p.m. CET.
The European Union’s sanctions banning Russian oil imports entered into force on Monday. Although Hungary has pulled off an exemption, what we had feared has taken place. The sanctions coming into effect will cause serious disruptions to Hungary's fuel supply.
MOL sent a letter to the minister of energy informing him that without fuel imports, it would not be able to meet the country's fuel supply needs. The result of Brussel’s sanctions is that we can no longer secure the HUF 480 gasoline price for every Hungarian family at every gas station in the country. Therefore, due to the Brussels-initiated oil sanctions, the government – upon MOL’s proposal – has removed the fuel price cap.
Sanctions have caused oil and energy prices to rise to historic highs across Europe. Meanwhile, in Hungary, the price cap has created an impossible situation, with demand skyrocketing. Zsolt Hernádi, CEO of MOL indicated the necessity of lifting the cap, saying MOL has sold 2.2 billion liters of fuel so far this year, compared to 1.5 billion last year. In the last seven days, more than 50 million liters of fuel have been sold, which is a 60 percent increase from the amount sold a year ago.
Sales of gasoline in recent days have been almost double that of the previous year and two and a half times higher than in 2020. Last week, 2.2 million customers were served, a level of activity typically only seen during the summer tourist season.
The MOL CEO said that due to the spike in demand from consumers stocking up, “a kind of panic has set in.” He added that a quarter of their service stations ran out in the last few days, while 871 wholesale orders could not be filled.
Zsolt Hernádi said that “since MOL has been around, nothing like this has ever happened.”
To mitigate the temporary shortage, Hernádi announced that MOL has been tasked by the government to ensure the country's fuel supply, even by organizing imports of more expensive Brent oil if necessary.
Hernádi stressed that the price cap lasted more than a year and that the company has done its utmost to meet demand. “Our trucks ran day and night, but they can't deliver more,” he said.
The MOL CEO warned the public that in addition to the delayed impact of the Brussels sanctions already in place, new sanctions that come into effect on February 5 will once again create a critical situation.
Starting in February, due to the sanctions on Russian exports, 10 percent of the European market’s diesel fuel will no longer be available; this could cause problems, as two-thirds of the Russian oil that MOL refines in Bratislava is now subject to restrictions.
Zsolt Hernádi said that “imports must be restored, and stocks must be replenished.” He added that action must be taken immediately to have a stable, import-supported fuel market in the country again by the beginning of next year.
“Security of supply must be ensured at all costs,” the CEO said. “These measures are a major step towards ‘easing’ the chaos on the fuel front,” which is necessary to guarantee that the country takes a strong and massive stand in the face of the next round of Brussel’s sanctions.
On this matter, Gergely Gulyás added that gas, electricity, and petrol prices had already been rising, but the persistence of this trend is clearly due to Russian aggression and EU sanctions.
According to the minister, while lifting the price cap will increase inflation, price freezes are only useful as long as they do not endanger the availability of the product to Hungarian families. "We would have liked to maintain it indefinitely, but we saw that there was no way to do so," he said.