Filenews 8 April 2025 - by Charalambos Zakos
Donald Trump's tariffs may have shocked the markets, putting all countries on alert, but Cyprus may benefit, at least in the short term. This is because the drop recorded in the price of oil can – under certain conditions – bring a significant reduction in electricity and fuel prices in Cyprus.
A reduction that may come at a time when electricity consumption will be at its peak, since in case of reductions these will be reflected in EAC tariffs during the summer months.
The price of Brent crude oil on Monday had fallen close to $60 a barrel. The last time the price of oil was at these levels was during the pandemic period, in April 2021.
Analysing the data of April 2021, the price of a kilowatt hour in Cyprus during the summer months of 2021 ranged between 20 and 23 cents per kilowatt hour. Correspondingly, today the price of a kilowatt hour is close to 30 cents, so the prospect of a reduction in electricity prices to 2021 levels will strengthen as long as oil remains at low prices.
What can be taken for granted is the fact that based on current developments - and if oil prices in the international market do not recover immediately - there will be a decrease in electricity prices, but it is not possible to estimate at the moment the percentage that this decrease will reach.
It should be noted here that the decrease or increase in oil prices appears in the EAC tariffs after the passage of a few months, since the Cyprus Electricity Authority has reserves for a period of two to three months, so it is possible that the reductions will be noticed by consumers during the summer months.
Of course, for the above to apply, some conditions must be met, which at this stage are difficult to predict.
Especially:
- First, the reduced oil price should continue at these levels and
- Secondly, the Cyprus Electricity Authority should proceed with the pre-purchase of significant quantities based on these prices.
As "F" is informed, the issue is already of concern to the Electricity Authority of Cyprus. In fact, our information states that the issue of the purchase of fuel, based on the developments and the fall in the price of oil, was raised in yesterday's session of the competent authorities.
And the motor fuel
In case the price of oil is kept at these levels, consumers will also see reductions in motor fuels.
Analysing again the prices of motor fuels during the corresponding period of 2021, when the price of Brent was at these levels, it seems that there is the prospect that gasoline and diesel prices will fall by as much as 20 cents per litre.
In particular, gasoline 95 and diesel are currently sold for €1.4 and €1.5 per liter, respectively. In the period of April 2021, gasoline and diesel prices had fallen to €1.2 and €1.3 per liter, respectively.
