Middle East war, low Danube levels and state influence: Why diesel prices in Serbia hit a historic record

Drivers in Serbia are hearing bad news every Friday. Fuel prices have continued to rise, and diesel has now reached a historic record, surpassing even the prices seen during the 2022 energy crisis.

Asked by N1 whether fuel was expensive, one driver replied: “Yes. Today, yesterday and tomorrow.” Another said the cost depended on how much a person drove, while one driver reported spending about 200 euros a month on fuel. For some, smaller cars remain manageable. One man joked that he owned five cars, drove the one costing 500 euros, and added: “My father rode a horse. People have never lived better.”

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Yes. Today, yesterday and tomorrow.

The figures place Serbia among the countries with the most expensive fuel in the region. Only Albania is more expensive, with petrol costing about 258 dinars and diesel about 270 dinars. Serbian drivers pay nearly 12 dinars more for diesel than motorists in Slovenia and Croatia. Diesel costs about 34 dinars less in Bosnia and Herzegovina and Bulgaria.

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It depends how much you use. It is never cheap.

Experts point to both international and domestic factors. The war in the Middle East and the blockade of the Strait of Hormuz, a key point for global oil supplies, have disrupted markets. Nebojša Atanacković of the Serbian Employers’ Union said diesel supplies are particularly tight in parts of the world, allowing suppliers to dictate prices. He also cited the suspension of Russian fuel exports after refineries were hit during the war.

In Serbia, fuel prices are set under a decision by the Ministry of Trade and Energy, based on exchange prices for petroleum products. Atanacković said taxation remains relatively high compared with neighboring Balkan countries, despite a 20% government reduction. He said further cuts to excise duties could help keep prices at their current level. Low Danube water levels are adding another obstacle by making it harder for companies to deliver fuel and replace shortages.

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One part of the world is facing problems with diesel prices and supply, and it is clearly in a much more difficult situation because there is not enough of it. As a result, suppliers are effectively beginning to dictate prices.