The energy crisis continues to put intense pressure on households and businesses, with international markets remaining volatile and upcoming diplomatic moves taking on growing importance for the trajectory of prices. The turbulence in global markets has already fed through to energy costs in Greece. The average wholesale electricity price from October 1 to 22 stood at €160 per megawatt-hour, marking an increase of approximately 20% compared to August. The gap is even wider on an annual basis, as the price during the same period last year was €93 per megawatt-hour. The picture is similar for natural gas, whose price is just below €70, up from €32, while oil is trading internationally at just over $100 per barrel, compared to $69 during the same period last year. The increases are also being felt at the pump. The average price of unleaded petrol stands at €2.20 per litre, while diesel is at €2.22 per litre, significantly raising transportation costs for both households and businesses.
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New support measures on the table
Faced with rising energy costs, the economic team is working on a new package of interventions aimed at limiting the burden on consumers. Among the scenarios being considered are a reduction in pump prices for diesel and heating oil, as well as an increase in the heating allowance.
The government, however, is signalling that fiscal room is limited and that any interventions must be targeted. At the same time, Athens is looking to Brussels, maintaining that the European Commission should take initiatives that give member states greater scope to fund measures addressing the energy cost surge.
First announcements on diesel
The plan for diesel fuel is considered the most advanced, with the government having already signalled that support will continue through October. The base scenario envisages an intervention of up to 15 cents per litre, with approximately 10 cents covered by a state subsidy and an additional 5 cents absorbed by refineries. The final level of support has not yet been confirmed, as it will depend on prevailing market prices and the outcome of negotiations with industry players. Related announcements are expected early next week, most likely following the return of Prime Minister Kyriakos Mitsotakis from the United States.
Heating oil: Target price below €1.75
The equation for heating oil is more complex, as its sale season begins on October 15. The target is for the opening price to come in below €1.75 per litre — a level that is difficult to achieve without additional intervention. Based on current market data, it is estimated that without support measures, the price could approach or even exceed €2.00 per litre.
For this reason, a mixed model is being considered, involving contributions from both the state budget and the refineries. Negotiations with energy companies are ongoing, as the government seeks to limit the fiscal cost while ensuring a meaningful reduction in the price paid by consumers.
Why they are waiting until October 15
The economic team does not want to lock in a subsidy level prematurely and then be forced to revise its plans due to a new shift in international markets. The closer the heating oil season gets, the clearer the picture will be on global prices and, consequently, on the amount needed to hit the target pump price. Deputy Minister of National Economy and Finance Nikos Papathanasis has already signalled that announcements on heating oil will come by the end of the month, stressing the need to first assess the evolution of international prices. As he noted on ERT’s “LiveNow” programme, the price per barrel has dipped below $100 after previously reaching around $108. “We will wait to see how international markets develop,” he said.
Heating allowance to increase by 20%
The package also includes a boost to the heating allowance, with the base scenario projecting an increase of approximately 20%. The measure is expected to affect around 1.17 million households, with amounts ranging from approximately €120 to €960. For areas with the highest climatic coefficients, the amount could reach up to €1,440. Income and asset eligibility criteria are not expected to change significantly. The primary change will therefore be in the level of the benefit rather than a major expansion of the eligible population. The final amounts remain under review and will be confirmed once the relevant decisions are made.
At least €100 million from fiscal reserves
The key challenge for the economic team is to deliver meaningful relief for consumers and businesses without derailing the budget. The latest information suggests that at least €100 million from fiscal reserves will be deployed. The final cost, however, will depend on how international prices evolve, the level of subsidies set, and — most critically — the degree of participation from the refineries.
The key dates
The first milestone is early next week, when announcements on diesel and the continuation of October support are expected. The second is October 15. By that date, the intervention on heating oil is expected to be finalised, along with the new framework for the heating allowance. The price at which heating oil launches will serve as the first real test of the measures’ effectiveness. The final decisions will also clarify the precise level of support, who qualifies, and how the increased heating allowance will be paid out.
Everything will hinge on international prices
The energy landscape over the coming months will depend heavily on developments in global markets. The trajectory of oil and natural gas prices, the stability of energy flows from the Persian Gulf, and the outcome of diplomatic initiatives are the key factors that could lead either to further de-escalation or to a new round of price increases.
For Greek households, attention is now focused on new electricity tariffs, the opening price of heating oil, and the final scope of state interventions. The decisions that will be taken in the coming days will go a long way toward determining the size of the energy bills that consumers will face as winter approaches.
