Cheaper fuel prices were one of the most important election promises of the governing parties and the Sweden Democrats.
On Monday, January 1, a central measure will come into force to try to realize this. The reduction obligation is then reduced to 6 percent for petrol and diesel during the period 2024–2026. Currently, the reduction obligation is 7.8 percent for gasoline and 30.5 percent for diesel.
The reduction obligation means that petrol companies must mix a certain amount of biofuel into petrol and diesel in order to achieve a reduction in transport emissions. Because the biofuel is more expensive, the prices per liter are higher.
According to the government, the price per liter is now estimated, in theory, with a reduced reduction obligation, to drop by 4 kroner for diesel and 30 öre for petrol. In addition to reduced reduction obligations, the petrol and diesel tax will also be reduced next year – by SEK 1.64 and SEK 0.43, respectively, including VAT.
SEK 3.85 per litre
Anders Norén, head of sustainability at the industry organization Drivkraft Sweden, has counted on the equation in a previous interview with TT.
– All in all, this would mean that the price of diesel is reduced at the pump by SEK 3.85 per liter and that petrol is reduced by SEK 1.05 per liter compared to 2023 according to the government’s documents, he said at the time.
When you add the indexation of the tax that is done every year, which is +11.31 percent based on the consumer price index plus another two percent, the tax cuts for diesel are eaten up. In practice, this instead means a tax increase of 15 öre per litre. For petrol, the tax is reduced by 75 öre per litre.
Several price factors
The fuel prices that come into effect on January 1 are set on the same day. The largest fuel companies emphasize that the price at the pump depends on a number of factors, including exchange rates, the price of oil and product prices.
“What we can say is that both HVO100 (hydrogenated vegetable oil, a renewable fuel for diesel engines, reds.note) and diesel prices will be lower on the first of January compared to the last of December. This also applies to gasoline, although the difference will be significantly smaller “, OKQ8’s communications department writes in an email.
Criticism from several quarters
The Moderates, the Christian Democrats and the Sweden Democrats promised reductions of 5 to 6 kroner per liter for petrol and upwards of 10 kroner for diesel ahead of the 2022 parliamentary election.
Critics believe that the driving force of households to switch to electric cars decreases even more with reduced reduction obligations. Skepticism has also been expressed from the industry.
– There is no one in the industry who believes that it will be close to that figure, Preem’s press manager Dani Backteg has told SvD.
One reason is that there may be a shortage of the diesel used in Sweden, which would raise the price. Another is that many refineries have redirected their production and switched to producing renewable fuel. It has been done at the expense of producing the arctic diesel needed at our latitudes.
Changes in the fuel market next year
• The tax on petrol is reduced by 75 öre/litre including VAT.
• The tax on diesel is increased by 15 öre/litre including VAT.
• The tax on E85 is reduced by 19 öre/litre including VAT.
• The reduction duty on petrol is reduced from 7.8 per cent to 6 per cent.
• The reduction duty on diesel is reduced from 30.5 percent to 6 percent.
Sources: Government, Circle K