Projected increases in fuel prices as government's tax excise comes into force

A revision in the prices of petrol and gas is expected to come into force on January 1, as the government's respective agreements with Enemalta and Liquigas expire.

In a dig at the Nationalist administration, Prime Minister Joseph Muscat had argued that the price stability on gas was a distant memory under his government.

"We had become accustomed to the fact that we cannot control the international price of gas. But now that Labour is in government, we have managed to achieve price stability on gas," the Prime Minister had said in September.

Acting on his promise, the government announced an agreement with Malta's main importer of liquefied petroleum gas Liquigas to "lock in" the price of gas cylinders for three months.

Nevertheless, the agreement saw the price of the standard 12 kg cylinder increased by €1 up to €18.30. On the other hand, the 15 kg cylinder increased to €22.90 following a €1.25 increase. However, another revision in the prices of gas is in the pipeline as from next Wednesday as the government's agreement expires.

Meanwhile, a revision in the price of petrol is also in the pipeline as the government's tax excise on fuel comes into force on January 1.

In a bid to increase its revenue by a projected €21.4 million, the government had announced excise duties on fuel, cigarettes, cement, alcohol and oil bunkering. However, Finance Minister Edward Scicluna had announced that the price of petrol would still rise by at least 1c as the excise on fuel comes into force next Wednesday.

On the other hand, diesel which is currently priced at €1.36 per litre, is also set for a revision in prices as a pilot project by Enemalta Corporation expires at the end of December 2013.

On the other hand, currently priced at €1.36 per litre, diesel is also set to see a revision in its prices as a three-month pilot project embarked upon by Enemalta expires at the year end.

The state utility arm had announced the reduction of petrol and diesel, leaving the prices unchanged until the end of the year. The prices were achieved after Enemalta reached an agreement with international banks Barclays and Deutsch Bank for a three-month fixed price and with local banks HSBC and BOV for a fixed currency exchange rate.