Hungary | Capping energy prices for

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Hungary will eliminate the capping of energy and gas prices for households with higher consumption from August 1, the Government of Budapest announced on Thursday, through a decree, which means that many citizens will pay more for the extra energy they use. consume it, Reuters and AGERPRES report.

The measures will help the Executive to cover the “hole” in the budget, after the capping of prices, in force for almost a decade, placed a significant burden on public finances, given that the price of energy on a global level has risen a lot.

According to the decree, Hungarian households will be eligible for the current energy price cap if they use up to 2,523 KWh of electricity per year, but will pay roughly double if consumption exceeds this level, although the Government has assured that it will still be below the market price.

For gas, the limit for the current price ceiling is 1,729 cubic meters per year, above this level the market price applies, which would represent a seven-fold increase.

Earlier, the Hungarian Minister of Foreign Affairs, Peter Szijjarto, said that Budapest is discussing the purchase of a larger amount of gas from the world market, before winter.

Since Russia’s invasion of Ukraine, inflation has risen sharply in Central Europe, adding to already strong price pressures from the pandemic and prompting central banks to sharply raise interest rates.

The Budapest government announced in November that gasoline and diesel prices cannot exceed 480 forints ($1.29) per liter at gas stations, below current prices of more than 500 forints. Also, in February, the prices of some basic foods were capped.