The combined effect of cold weather and lower heating fuel price levels has boosted demand for heating fuel but demand for transportation fuel has not been lifted by the price reduction.
According to market officials, overall demand for heating fuel throughout Greece shot up by 150 percent during the first twelve days of January.
Based on recent official data, heating fuel in Greece was priced at 89.1 cents per liter on January 9, and 54 cents per liter for underpriveledged households that are eligible for subsidized support. Yesterday, price levels, based on unofficial figures, had fallen further to approximately 80 cents and 47 cents, respectively.
The ongoing decline in international crude oil prices promises further fuel price reductions in the Greek retail market. However, sector officials believe that the sharp rise in domestic demand for heating fuel will slow down as the majority of households eligible for the subsidized program have already reached the offering’s pre-determined limit, and will therefore make do with quantities already purchased, even if there is more cold weather ahead. Close to one million househoulds applied for the subsidized heating program.
According to POPEK, the union representing the fuel trading sector, the demand increase in heating fuel for the wider Athens area stands way below the 150 percent figure reported for the national market, and has been limited to 25 percent. POPEK president Giorgos Asmatoglou attributed this large discrepancy to a considerably sharp increase in demand for heating fuel in Greece’s north, where the recent weather has been particularly cold.
Demand for natural gas has also risen, but this market trend has been exclusively linked to the weather, as price levels have not changed. In fact, in an unprecedented development, heating fuel prices have fallen below those offered for natural gas. The country’s EPA gas supply companies expect household gas demand to increase further as a result of a subsidized program facilitating heating system conversions from fuel to gas.