Experts warn of sharply higher fuel prices under any Swedish government

Petrol and diesel prices in Sweden are set to rise sharply during the next parliamentary term, regardless of which parties win the election. Several experts told Dagens Nyheter that the increase could come even without active measures from the next government.

Sweden currently has a special exemption from the European Commission that allows it to keep its fuel tax below the EU minimum. That exemption applies only until the end of the year. Once it expires, prices are expected to rise by several kronor, probably as early as the New Year.

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The fact that Sweden has almost the lowest petrol prices in the EU is not sustainable.

A further increase is expected from 2028, when the EU introduces its new emissions trading system, ETS2. The system aims to reduce transport emissions across the bloc. The size of the effect remains uncertain, but estimates point to at least 1 to 2 kronor per litre.

“Much of this will happen regardless of what the next government wants,” said Svante Mandell, the government’s climate investigator and an economist at the National Institute of Economic Research. Mandell said Sweden’s position as one of the EU countries with the lowest petrol prices is not sustainable.

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Much of this will happen regardless of what the next government wants.

The Tidö parties have placed strong emphasis on lowering fuel prices during the current parliamentary term, with increased emissions as a consequence, the article said. Domestic transport emissions rose by about 16 percent last year compared with when the government took office, according to Swedish Environmental Protection Agency statistics.

Three independent experts told DN that the next government will need to act quickly to reduce emissions. They include economist John Hassler, environmental economist Svante Mandell and Åsa Persson, outgoing chair of the government’s Climate Policy Council.

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Action is needed quickly and across many sectors.

The Climate Policy Council estimated this spring that missing Sweden’s climate requirements could result in EU fines of about 8 billion to 40 billion kronor. Persson said action was needed quickly and across many sectors. Mandell’s policy-instruments inquiry, submitted to the government during the summer, contains proposals intended to help Sweden meet the EU requirements.

The inquiry identifies three theoretical ways to reduce transport emissions. Mandell considers electrification the best long-term strategy, but says it will not have enough effect by 2030 because around 4.5 million cars with combustion engines remain on Swedish roads.

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But by 2030, electrification will not have enough effect.