At the beginning of March, a sharp increase in demand for fuel was recorded in Cyprus. According to representatives of the fuel market, on Monday, March 2, sales of gasoline, diesel fuel, and heating fuel increased by more than 30%. Such a surge is linked not only to the needs of motorists but also to residents’ desire to stock up on fuel in advance amid escalating international tensions and expectations of rising prices.
This was reported by the head of the Pancyprian Association of Petrol Station Owners, Savvas Prokopiou. According to him, such a sharp increase in demand was observed specifically on Monday, while by Tuesday the pace of sales had already begun to decline slightly. The final dynamics will become clearer in the coming days, but experts assume that the excitement will gradually weaken.
Unexpected rise in demand for heating fuel
Market participants were particularly surprised by the increase in demand for heating fuel. Normally in March sales of such fuel decline, since the winter season ends and air temperatures begin to rise. In a typical situation demand during this period drops noticeably.
However, the current geopolitical tension has changed consumer behavior. Many residents of Cyprus prefer to purchase fuel in advance, fearing further price increases. According to Prokopiou, without factors related to international conflict such a spike in demand at the beginning of spring would be almost impossible.
The psychological factor and experience of past crises
Experts note that the situation in the fuel market depends not only on economic factors but also on the psychological reaction of consumers. During periods of international conflicts people often try to stock up, which itself increases demand and can accelerate price growth.
A similar situation has already been observed before, when demand for fuel and its price increased much more strongly than now. According to industry representatives, the current market reaction remains more moderate for the moment.
First signs of rising gasoline and diesel prices
Amid increased demand, some oil companies have already begun adjusting fuel prices. According to industry representatives, one company increased the wholesale price by about one and a half cents per liter. However, this change has not yet been fully reflected at petrol stations, since there is usually about a two-day delay between changes in wholesale prices and retail prices.
It is expected that other fuel suppliers will also gradually begin raising prices. According to specialists’ estimates, the next batches of fuel may become more expensive by about 6–7 cents per liter. This forecast is based on previous market experience in similar situations.
The influence of global oil prices
The situation in the fuel market is directly connected with fluctuations in global oil prices. Experts note that even two months before the current geopolitical escalation, oil prices on world markets had already begun gradually rising.
After the escalation of the conflict between the United States of America and Israel on one side and Iran on the other, the price of oil on international markets increased by about 15% in a short time. At the same time, final fuel prices rise more slowly because a significant part of their structure consists of fixed taxes and charges.
What drivers in Cyprus should expect
According to specialists in the fuel market, further price dynamics will depend primarily on the development of the situation in the Middle East. If the global price of oil remains below the level of about 90 dollars per barrel, the increase in fuel prices in Cyprus will likely remain within the current forecasts.
If geopolitical tensions intensify and oil quotations continue to rise, the cost of gasoline and diesel fuel may increase more strongly. Nevertheless, market participants expect that after the initial surge in demand the situation will gradually stabilize, and consumer activity will return to its normal level.
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