The Swedish government announced on Wednesday that it will temporarily reduce fuel taxes to help offset rising energy prices resulting from the war involving Iran, following a similar tax cut introduced in March.
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The measure will reduce fuel tax by 2.4 Swedish kronor ($0.25) per liter, resulting in a decrease of approximately 3 kronor per liter in gasoline and diesel prices after value-added tax is included.
The move is estimated to cost around 7.7 billion kronor and forms part of a broader 17.5 billion kronor crisis support package.
Energy Minister Ebba Busch said during a press conference: “We are now facing the worst global energy crisis ever. The situation in the Middle East remains unstable, and we will be tested.”
Finance Minister Elisabeth Svantesson said the economic impact of the war on Sweden would continue throughout the year, even if the conflict ended immediately.
Tensions in the Strait of Hormuz, through which roughly one-fifth of global oil and gas supplies pass, have contributed to rising global energy prices.
Sweden had previously introduced a tax reduction that lowered gasoline and diesel prices by approximately 1 krona per liter.
The country has already reduced fuel taxes to the minimum level permitted under the European Union, and the new reduction—scheduled to take effect from 1 July through 30 November—will require approval from the European Council.
Busch also said that an additional 1 billion kronor has been allocated to compensate households affected by rising electricity prices, adding that further support measures for the agriculture and aviation sectors will be announced.
In late April, Prime Minister Ulf Kristersson said Sweden is preparing for the possibility of fuel rationing in the coming months, although no immediate plans are in place.
AFP
