First, let’s talk a bit about natural gas before we get into fuel cost!
Where does Europe get natural gas?
The gas comes from Norway, Russia, Netherlands, Iran, Algeria. Norway represents an important source and Russia 37% of the supply. The rest is accounted for by other countries. It is notorious that countries are increasingly looking for renewable sources. Germany has 37% renewable electricity and Portugal is almost like that, with solar and wind power.
Nothing better than illustrating with a picture.
What would happen if Russia cut off natural gas supplies to Europe?
We can expect a big increase due to the cut in supply. Europe would be held hostage by natural gas from Scandinavian and Nordic countries. On the other hand, Russia would also experience a major financial crisis, given that a good part of its revenue comes from the sale of gas.
The gasoline quality is better in the US or Europe?
It’s basically the same in both. Regardless of which refinery did the work, what will basically differentiate one gasoline from another is the additive package that was mixed into it. The laws and rules of each country and region change, for example, in Europe the minimum standard of 95 octanes is required, so when you go to a gas station in Europe, it is usually 95 (standard), 95 premium and 98. In the United States and countries like Brazil, slightly lower octane numbers are required.
Octane rating is basically the measure that tells you how resistant the fuel is to spontaneous burning inside the engine. This makes it easier to understand!
Relation between fuel cost and salary Europe/USA
The current price of gasoline in the United States (14 Feb 2022) is $3.71 per gallon or $0.98 per litre.
The price in Europe can vary greatly from country to country, for example in France we have €1.79 and in Portugal €1.83.
We have made a graph showing exactly the relation between Salary x Fuel Cost in some countries in Europe.
| Europe | |||
| Country | Average Salary(€) | Gasoline Price/Litter (€) | (Gas/Salary)x100 |
| Portugal | € 750,00 | €1,83 | 0,244 |
| Spain | € 1.800,00 | €1,60 | 0,09 |
| France | € 2.500,00 | €1,79 | 0,07 |
| Germany | € 2.300,00 | €1,77 | 0,08 |
| Switzerland | € 4.000,00 | €1,68 | 0,04 |
| Luxembourg | € 2.300,00 | €1,57 | 0,07 |
| Italy | € 1.800,00 | €1,87 | 0,10 |
| Netherlands | € 2.600,00 | €2,07 | 0,08 |
| Austria | € 2.300,00 | €1,48 | 0,06 |
| Denmark | € 3.500,00 | €1,92 | 0,05 |
| Sweden | € 2.700,00 | €1,83 | 0,07 |
| Belgium | € 2.500,00 | €1,74 | 0,07 |
| Poland | € 1.100,00 | €1,18 | 0,11 |
| Ireland | € 2.600,00 | €1,79 | 0,07 |
| Norway | € 3.500,00 | €2,03 | 0,06 |
| Greece | € 780,00 | €1,90 | 0,24 |
| Finland | € 2.600,00 | €1,91 | 0,07 |
Result
What is means? The column (gas/salary) means the percentage of the total salary spent in 1 litter of fuel. Every liter of fuel will take this percentage of your monthly revenue.
GREEN: The better relation between price/salary.
RED: the worse relation between price/salary
| USA | ||||
| Country | Average Salary($) | Gasoline Price/Litter ($) | (Gas/Salary)x100 | Result |
| United States | $3.500,00 | $0,96 | $0,03 | The price can still be better than in Switzerland and all the countries in Europe. Much more, because this comparison was made in Dollar. |
Why is petrol in the USA cheaper than in Europe?
First of all we need to raise some data:
The cost to refine the fuel in Europe is higher than in the US, being no more than 30% of the cost and even then it would not justify almost doubling the price.
But what really makes fuel cost more expensive in Europe is taxation in most countries. Most European countries still have to pay VAT (value added tax), which makes the product even more expensive.
One reason why diesel is more common in Europe is that it is less taxed in many countries.
Inflation in Europe
Another reason for the sharp rise in prices in Europe is inflation. Only between 2021 and 2022 there was an increase of about 5.1%. Other factors such as economic instability, the global health crisis and political instability helped to aggravate these factors.
Follow the graph on the development of inflation in Europe.
Graphic: UOL
The evolution of fuel costs
In the graph below we see the practiced fuel cost in the year 2019.
Diesel Price in 2019:
| Country | Gasoline (Euro 95) | Diesel | LPG |
| EUR | EUR | EUR | |
| Portugal | 1,833 | 1.675 | 0.834 |
| Albania | 1,623 | 1.607 | 0.778 |
| Andorra | 1.453 | 1,324 | – |
| Austria | 1,495 | 1,481 | – |
| Belarus | 0.722 | 0.722 | 0.423 |
| Belgium | 1,746 | 1,779 | 0.785 |
| Bosnia and Herzegovina | 1,316 | 1,328 | 0.745 |
| Bulgaria | 1,294 | 1,316 | 0.706 |
| Croatia | 1,499 | 1,556 | 0.852 |
| Cyprus | 1,421 | 1,486 | – |
| Czechia | 1,548 | 1,505 | 0.691 |
| Denmark | 1,926 | 1,722 | – |
| Estonia | 1,678 | 1,516 | 0.777 |
| Finland | 1.959 | 1,882 | – |
| France | 1,794 | 1,739 | 0.927 |
| Germany | 1,770 | 1,682 | 0.907 |
| Greece | 1.906 | 1,639 | 1.071 |
| Hungary | 1,360 | 1,360 | 0.918 |
| Iceland | 1,961 | 1,866 | – |
| Ireland | 1,790 | 1.708 | – |
| Italy | 1,871 | 1,745 | 0.797 |
| latvia | 1.609 | 1,461 | 0.793 |
| Lithuania | 1,486 | 1.426 | 0.650 |
| Luxembourg | 1,575 | 1,517 | 0.803 |
| Macedonia | 1,351 | 1,219 | 0.716 |
| Malta | 1,355 | 1,224 | – |
| Moldova | 1,215 | 1.053 | 0.656 |
| Netherlands | 2,071 | 1,768 | 0.925 |
| Norway | 2,026 | 1,900 | – |
| Poland | 1,182 | 1,193 | 0.599 |
| Romania | 1.428 | 1,432 | 0.779 |
| Russia | 0.577 | 0.602 | 0.326 |
| San Marino | 1,731 | 1,631 | 0.810 |
| Serbia | 1,471 | 1,539 | 0.803 |
| Slovakia | 1,571 | 1,477 | 0.717 |
| Slovenia | 1,439 | 1,466 | 0.874 |
| Spain | 1.603 | 1,488 | 0.877 |
| Sweden | 1.839 | 2,063 | 1,233 |
| Switzerland | 1,689 | 1,767 | 1.074 |
| Turkey | 0.995 | 1,017 | 0.632 |
| Ukraine | 1,100 | 1.074 | 0.591 |
| United Kingdom | 1,813 | 1.855 | 0.855 |
As a comparison, we have Portugal:
Petrol price in 2019: €1.45
Petrol price in 2022: €1.83
This represents an increase of almost 30% in the increase of Gasoline.
