Consumers in Cyprus and across Europe will need to adjust to persistently high energy prices as geopolitical tensions continue to support elevated oil markets, despite a recent correction in crude prices.
Brent crude, Europe's main oil benchmark, remains close to $90 a barrel, a level that continues to fuel concerns over energy costs and inflation across the continent.
Oil markets remain highly sensitive to developments in the Middle East, particularly regarding Iran and shipping through the Strait of Hormuz, a critical artery for global oil trade. At the same time, supply management policies by the OPEC+ alliance continue to shape market conditions.
Fuel prices in Cyprus
According to the Consumer Protection Service's weekly bulletin dated 27 August, based on prices in force on 24 August, the average retail price in Cyprus, including taxes, stood at €1.476 per litre for 95-octane unleaded petrol and €1.649 per litre for diesel.
Data from the European Commission show that the average price of 95-octane unleaded petrol in Cyprus reached €1.586 per litre in August 2026, an increase of 10.1 cents per litre, or 6.8%, compared with July 2026.
The average price of diesel rose to €1.780 per litre in August, up by 18.5 cents per litre, or 11.6%, from the previous month.
Despite the increases, Cyprus ranked as the third-cheapest country in the European Union for 95-octane unleaded petrol and the eighth-cheapest for diesel.
Multiple factors drive prices
"The formation of retail petroleum prices is the result of the impact of a range of factors and does not depend exclusively on changes in any specific international benchmark price," Consumer Protection Service Director Constantinos Karagiorgis told Politis.
Among the factors taken into account, he said, are product purchase costs, existing inventories, insurance, transport and storage costs, distribution expenses, taxation, market competition and broader market conditions, as well as international benchmark prices for petroleum products.
"Particularly during periods of intense geopolitical developments and significant fluctuations in international oil markets, changes in the cost of petroleum products, as well as in insurance and cargo transportation costs, may significantly affect the final market price," he said.
Calls to extend fuel tax relief
DISY Deputy President and lawmaker Savia Orphanidou on Friday called for an extension of the reduced fuel tax measure, which is due to expire on 17 September, citing continued pressure from high prices and volatility in global energy markets.
She said a broader strategy was needed to address the issue and argued that extending the measure was fiscally feasible.
According to Orphanidou, the medium-term benefits for the economy and social cohesion would outweigh the short-term fiscal cost.
Government reviewing measures
Asked whether the reduced fuel tax could be extended, Finance Minister Makis Keravnos said on Monday that the measures "are being continuously evaluated depending also on developments and the specific decisions will be taken at the given moment".
However, he noted that the European Commission recommends that measures aimed at addressing energy costs should be targeted and temporary.
