Foreign Drivers Flock to Poland for Cheaper Fuel After Price Caps

Poland's government initiative to cap fuel prices is drawing a surge of foreign drivers, who are crossing the border to take advantage of some of the lowest gasoline prices in the European Union. The program, implemented in April, has made a noticeable impact on regional fuel markets.

Economists at PKO Bank Polski SA initially flagged the trend after retail sales data revealed a 13.4% increase in fuel consumption in April compared to March. However, the bank's internal analysis indicated that customer card transactions at gas stations remained stable. This suggests that the rise in consumption is primarily driven by demand from foreign customers or companies, rather than increased domestic spending.

The Polish government reduced fuel taxes and introduced price caps in April to cushion the impact of rising energy costs. Authorities in Warsaw are considering extending these measures until June. The program's estimated monthly cost is around 1.6 billion zlotys, approximately $440 million. Currently, a liter of Eurosuper 95 gasoline averages 1.49 euros, placing Poland second only to Malta for the lowest gasoline prices within the EU. Orlen SA, Poland's main fuel distributor, stated that the influx of foreign customers has not significantly impacted its sales volumes.