Hungary tightens limit on road fuel purchases: Update

Adds details on OMV retal stations in paragraph 4

Hungarian integrated oil firm Mol is halving the amount of road fuel that passenger cars can buy from its domestic retail stations to 50 litres per purchase, down from a previous limit of 100l.

The cut partly reflects the fact that Hungarian road fuel demand remains above average as a result of the government's cap on pump prices.

"The limit was determined based on the quantity that is sufficient for retail users and that exceeds the volume of typical average refuelling," Mol told Argus. The company aims "to ensure that all customers are served and that filling stations operate smoothly". Buyers filling up fuel cans are no longer eligible for capped prices, Mol added.

Austria's OMV has also put a 50l limit on purchases of most road fuels at its retail service stations in Hungary from today. OMV operates nearly 200 filling stations in Hungary and has a 15pc share of the local retail market.

Budapest first introduced a temporary price cap on 95 Ron gasoline and regular diesel at 480 forint/l ($1.27/l) in November to help shelter motorists from rising fuel costs. The price cap has since been extended several times, most recently until 1 October this year, underpinning a significant increase in Hungarian road fuel demand, especially from international freight forwarders and foreign drivers.

The government approved modifications to the policy in early March banning trucks above certain weight limits from buying fuel at capped prices. And since late May, the subsidised prices have been available only to vehicles with domestic registration plates.

But these measures "couldn't really" reduce the 20pc demand growth generated by the price cap, the Hungarian Petroleum Association (HPA) told Argus. Consumption of motor fuels usually peaks in July-August, and this peak may be higher this year, it said.

"We have risks on the supply side, the whole of Europe and our region are short on fuels," the HPA said, pointing to a significant reduction in capacity at Austria's 193,700 b/d Schwechat refinery because of a mechanical incident and temporary problems caused by a small fire at Mol's 161,000 b/d Szazhalombatta refinery in Hungary.

Schwechat is expected to resume full operations in the second half of August or September, operator OMV said today. Meanwhile, Mol has confirmed that Szazhalombatta's crude unit is back online after the fire on 14 June. The firm is planning to carry out an overhaul at Szazhalombatta in August, postponed from April, which may constrain supply later this summer.

By Bela Fincziczki