Brent crude, the international oil benchmark, was trading in the beginning of July at almost exactly the level it held before this year’s Middle East conflict sent energy markets higher. Yet at filling stations across Greece, gasoline and diesel remain noticeably more expensive than they were in late February. The gap between those two facts has become a persistent question for Greek drivers. The reason lies not in the war but in the chain that sets fuel prices: international benchmarks, the country’s refineries and the tax loaded onto every liter.
Does Brent crude set the price of gasoline?
Not directly, and this is where most of the confusion starts. On July 6, Brent traded at $71.99 a barrel. On Friday, Feb. 27, the day before the U.S. strike on Iran, it stood at $72.48. That is a decline of just 0.7% across a period that contained both a war and a ceasefire. Over the same stretch, the euro weakened about 3.3% against the dollar, the currency in which crude and fuels are priced.
But Brent is a benchmark for crude oil, the raw input. Gasoline and diesel are finished products with their own markets, shaped by refining capacity, inventories, seasonal demand and geopolitics. A driver never buys crude. They buy a refined fuel whose price is set somewhere else entirely.
What Greek refineries actually follow
Mediterranean refineries, including those in Greece, price their output off the Platts assessments, the daily benchmarks that value refined products. Those benchmarks tell a very different story from crude. Between Feb. 27 and July 6, the Platts price for gasoline rose to $956.50 a metric ton, an increase of 31.5%. Diesel climbed 30.8% over the same period. While crude went nowhere, the refined fuels that Greek drivers actually buy became roughly a third more expensive on international markets.
Did refiners widen their margins?
There is a widespread perception in Greece that refineries use moments like this to widen their margins. The figures point the other way. Over the same window, the prices at which refineries sold gasoline and diesel to fuel marketing companies rose 13.4% and 16.5% respectively. Those increases are less than half the rise in the Platts benchmarks the refineries pay to price their product, which were up 31.5% and 30.8%. A refinery that raises its prices by less than its own costs is not widening its margin. It is absorbing part of the increase.
What happened at the pump
At the pump, there were increases yet again, albeit smaller this time around. In Attica, the region around Athens, the average price of unleaded gasoline rose 11.1% to 1.928 euros a liter, and diesel rose 12% to 1.738 euros a liter. Each stage passed on less than the one before it: about 31% on the international benchmarks, 13% and 16% at the refinery, and 11% to 12% at the pump.
Why taxes blunt every price move
Falling crude prices are never passed on to drivers in full, because so much of the pump price is fixed by the state. Roughly 60% of the final price of gasoline in Greece is made up of excise duty, VAT and other levies. For diesel, the share is above 40%. When the underlying product moves, the total moves by far less, because a majority of what a driver pays does not change with the market at all.
Why prices lag the market by a few days
Even when international prices fall, drivers do not see it immediately. Fuel prices, which begin forming at the refinery, shift about four days after Platts adjustments. The lag reflects how Platts sets its figures, using an average of the previous four days’ prices.
The refining bottleneck behind it all
The real story is not in the crude market at all, but in refining. For several years the world has struggled to turn enough crude into finished fuel, and the tightest constraint is not the supply of oil but the capacity to process it. Europe is a large part of that. A string of refineries across the continent have shut or been converted in recent years as the industry retools for the energy transition, leaving fewer plants to draw on when supply is interrupted. That thin margin forces greater reliance on imports and lets shortages develop in individual products.
War has made a tight market tighter. Keeping fuel flowing has meant running down strategic and commercial stockpiles, and in places the squeeze surfaced as shortages of jet fuel. Strikes on production and refining sites across the Middle East and the Gulf pulled finished product off the market and lifted international prices. Russia and Ukraine have added to it, each targeting the other’s energy and refining infrastructure, knocking out processing capacity and tightening supply worldwide.
Where prices have fallen, they have fallen selectively. The easing has shown up mainly in fuel oil and, in some markets, jet fuel. Gasoline has stayed firm, held up by constrained refinery output and tangled supply chains, which is why cheaper crude has yet to reach the pump.
Can Greece set its own prices?
No. Greece is part of a global fuel market and follows international developments rather than setting prices on its own. What drivers pay reflects the full picture, from crude to refining capacity to inventories to geopolitical tension, and not any single index.
Source: OT.gr
