A warning from Nikos Papageorgiou, president of the Attica Fuel Station Owners Association, might have sounded exaggerated until recently. Today it carries a different weight. Oil has climbed past $105 a barrel, as tension in the Middle East and fears of a supply disruption push energy prices higher again. For Greek consumers, what matters is not the number traders watch on their screens, but the number that will appear on gas station signs within days.
Papageorgiou, speaking in a television interview on Meganews, said gasoline prices in Attica, the region that includes Athens, could reach 2.15 euros a liter within days. Until recently, 2 euros a liter was seen as a psychological threshold for Greek consumers.
Minister Signals More Help Is Possible
In a television interview this morning, Greek Minister of Environment and Energy Stavros Papastavrou did not rule out new measures to support households if fuel prices fail to come down.
“We are monitoring developments by the hour,” Papastavrou said. “We have proven that whenever it was needed (we act). Right now we are not moving in that direction. We support the Greek society. We don’t leave anyone behind.”
Asked whether the government was considering additional relief measures, Papastavrou declined to specify their form but said the government would not stand by as prices rise. “I do not want to go into specifics, but we will not leave any member of society behind,” he said. “As we have done until today, we are clearly not indifferent.”
On gasoline specifically, Papastavrou said the government would reassess the support measures that were in place in August and September, depending on how the market develops in the coming weeks. “The measures that were in effect in August and September will be reexamined,” he said. “There too, we need to wait for some developments.”
What Is Driving the Rally
The latest surge traces back to a reescalation of the conflict between the United States and Iran, which has reinforced expectations of a prolonged standoff despite a statement from U.S. President Donald Trump that he expects the war to end after the midterm elections. The tension has raised fears of inflation, as natural gas and diesel prices climb alongside crude.
Goldman Sachs has raised its price forecasts for Brent and West Texas Intermediate crude by $5 a barrel, to $85 and $80, respectively, for December 2026, and to $80 and $75, respectively, for 2027. The bank’s new assumption is that shipping disruptions in the Middle East will continue into next year. In its worst case scenario, Goldman sees oil spiking to $120 a barrel.
That outlook lands on top of prices that were already rising before the latest spike. Consumer prices in Greece rose 3.8 percent in August, driven largely by energy. Heating oil prices jumped 53.2 percent from a year earlier, natural gas rose 40.2 percent, automotive diesel climbed 30.6 percent and gasoline increased 15.3 percent. The average price of automotive diesel remains above 2 euros a liter even with a state subsidy of 10 cents a liter, including value added tax, plus an additional 5 cent per liter discount from refineries.
Government Weighs Extending Support Into Winter
The government’s economic team says it is monitoring international prices and will activate additional household support measures if needed, with interventions covering both diesel and heating oil already under consideration.
An extension of the automotive diesel subsidy into October appears close to certain. Omiros Tsapalos, spokesperson for the Ministry of National Economy and Finance, said on MEGA that the subsidy currently runs through the end of the month, funded jointly by refineries and the state budget.
“There is a margin of about 130 million euros that we have set aside from the 2025 budget surplus, so that, if judged necessary, this subsidy can be extended into October as well,” Tsapalos said. “We are necessarily going month by month.”
Heating oil poses a separate challenge. Greece’s heating allowance program begins on October 15, and based on current data, if the distribution period opened today, the average nationwide heating oil price would exceed 1.90 euros a liter. That compares with 1.10 euros a liter when last year’s period opened in October 2025, and it is even above the 1.80 euros a liter recorded last April, when the previous distribution period closed.
The heating allowance itself ranges from 100 euros to 800 euros, rising to as much as 1,200 euros in areas with especially cold winters. The economic team has not ruled out a separate intervention on heating oil if the prices at which the market opens in October are judged too high, and industry figures are calling for greater household support, including a proposal to subsidize heating oil directly at the pump. Additional, longer term relief is planned under Greece’s Social Climate Fund Plan, which has been approved by the European Commission and calls for a 100 euro annual increase to the heating allowance for about 780,000 beneficiaries between 2027 and 2032.
Higher Rates Add to the Squeeze
The European Central Bank has added a second front to the pressure on household budgets, raising its key interest rate by 25 basis points and citing the same inflationary pressures reshaping its policy outlook. For households, the effect is direct: more expensive fuel feeds higher prices, and higher prices feed more expensive borrowing.
The impact will show up quickly in mortgage payments. For a mortgage with a remaining balance of 150,000 euros and a repayment period of 20 years, a rate increase from 3.8 percent to 4.05 percent would raise the monthly payment from about 893 euros to about 913 euros, or roughly 20 euros more a month, about 240 euros a year.
Source: OT.gr
