The government’s economic team is on high alert as a new surge in energy prices brings the threat of yet another wave of cost-of-living increases back to the forefront, making targeted interventions to shield households from a difficult winter an urgent priority.
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The escalating crisis in the Middle East has set oil prices ablaze, with Brent crude trading above the psychological threshold of $100 per barrel and triggering a new domino effect of price increases — from fuel and transport to production costs. Rising energy prices are pushing up bills for households and businesses alike, opening a new front in the battle against inflation at a time when the government is already working to rein in the cost of living.
The average price of diesel remains stubbornly above €2 per litre, despite a state subsidy of 10 cents per litre (including VAT) and a 5-cent-per-litre discount from refineries. At the same time, heating oil is threatening to debut at exceptionally high prices. Based on current market conditions, if heating oil sales were to begin today, the national average price would exceed €1.90 per litre.
This represents a dramatic increase compared to the €1.10 per litre price at which last year’s heating season opened in October 2025, and is even higher than the €1.80 per litre recorded last April when the heating oil sales period closed.
The Brent crude rally captures the full scale of the upheaval in the energy market. Since early August, the price has risen by approximately 25%, while the increase since the start of the year now exceeds 60%. Since the outbreak of the Middle East war on 28 February 2026, Brent has spiked as high as $126.41 per barrel on 30 April, and yesterday crossed the $100 barrier again — for the third time this year.
New measures to tackle rising energy costs
The government’s economic team is monitoring international prices on a daily basis, as well as the speed at which price increases are feeding through to the Greek market. If necessary, additional household support measures will be activated. Interventions targeting both diesel and heating costs are already on the table.
The most immediate proposal is an extension of the diesel subsidy through October — a scenario considered highly likely. According to the spokesperson for the Ministry of National Economy and Finance, Omiros Tsapalos, “the subsidy, both from the refineries and from the state budget, is in place until the end of the month. We have a buffer of around €130 million set aside from the 2025 surplus, so that, if deemed necessary, the subsidy can be extended into October as well. We are being forced to take this month by month.”
Heating oil sales are set to begin on 15 October 2026, and if international markets do not ease, households risk entering the winter facing a particularly heavy energy bill. Industry players are calling for greater support for households, proposing that the heating oil subsidy be applied directly at the pump. The heating allowance currently ranges from €100 to €800, and in the coldest regions reaches up to €1,200.
It is worth noting that Greece’s Social Climate Fund Plan, approved by the European Commission, includes a provision to increase the heating allowance by €100 per year for approximately 780,000 eligible recipients. According to the action timeline, this increase will apply for the period 2027–2032, with the aim of absorbing part of the additional burden caused by rising costs for heating oil, natural gas, and LPG.
