Andorra Fuel Importers Warn Government of Shrinking Price Edge Over Spain Amid Oil Crisis

Andorra's fuel importers met Finance Minister Ramon Lladós on Thursday to present data on shrinking price advantages over Spain, triggered by rising oil costs from the Middle East conflict and Madrid's recent tax cuts. Assidca president David Porqueres and vice-president Carles Visent described the session as an initial contact to share technical analysis, without formal demands, emphasizing reduced differentials that threaten sales—primarily from tourists—and state revenue.

Porqueres highlighted the sector's restraint in passing on costs, with increases of 25 cents per litre on 95-octane petrol and 42 cents on diesel since late February, compared to 40-60 cents at Spanish low-cost stations like those in La Seu d’Urgell. Spain's measures, effective from 20 March—including VAT cut to 10% from 21% and hydrocarbons tax to the EU minimum—have produced initial pump drops of 13 cents on diesel and 15 on petrol, with up to 30 cents total savings expected over 10-15 days as distributors apply them gradually alongside volatile oil prices.

Current Andorran averages stand at €1.670 per litre for diesel (up 38-42 cents from €1.249 on 28 February), €1.547 for 95-octane and €1.603 for 98-octane (both up 25 cents). Catalan prices yesterday showed diesel at €1.79 (12 cents higher), 95-octane at €1.599 (5 cents higher) and 98-octane at €1.725 (12 cents higher). Porqueres warned that without action, Andorra risks losing competitiveness in a key product, potentially cutting tax intake from fixed levies—54 cents per litre on 95-octane, 58 on 98-octane and 40 on diesel—including IGI, special hydrocarbons duties and CO2 tax.

Economy Minister Conxita Marsol, speaking after Wednesday's Council of Ministers, offered an "open hand" and confirmed a broader meeting for Friday with government officials, Assidca and Director of Taxes Carles Ferreira to explore options. She stressed coordinated measures with safeguards to benefit consumers, not margins, though Andorra's rigid tax system requires parliamentary approval—potentially via urgent procedure (48 hours minimum)—and 8-15 days for co-princes' ratification, unlike Spain's decree powers.

Transport firms report €60-70 extra per Barcelona trip and are preparing requests to extend 2022 subsidies (up to €0.24 per litre for eligible vehicles, capped at 8,000 litres annually). Economy and Transport Secretary of State David Forné said authorities are tracking prices and gathering stakeholder input. Pas de la Casa's Gasopas station noted 5-10% higher traffic from French drivers, aided by RN20 reopening, though full oil impacts are delayed by stocked fuel averaging. Effects may persist pending Strait of Hormuz stabilization.