Poland’s temporary reduction of VAT on fuel from 23% to 8% expires on June 30, but drivers may not feel a sharp spike at the pump. The energy minister says the program will not be extended, while market dynamics suggest the expected price jump has already been partially absorbed by the fuel retailer Orlen.
The ministry of energy confirmed that the lower VAT rate on fuel, introduced in April, will not be extended beyond June 30. Minister Miłosz Motyka stated clearly: – There will be no need to extend the CPN program after June 30. The decision comes as global crude prices have fallen significantly. Brent crude is now trading at around $73 per barrel, the same level as on February 27, the day the US launched its military operation against Iran.
While European diesel prices dropped by 16.8% from their June 11 peak, Orlen’s wholesale price for diesel fell only by 4.6% in the same period. This discrepancy suggests that the company deliberately kept prices higher than wholesale markets would dictate, building a buffer to offset the eventual VAT increase. As a result, the return to the 23% rate may translate into a rise of only a few groszy per liter, as Motyka had earlier indicated.
Inflation and growth outlook steady
The National Bank of Poland’s latest survey of professional forecasters paints a relatively stable picture for the Polish economy. Inflation is expected to average 3% in 2026, gradually declining to 2.7% by 2028. GDP growth is forecast at 3.5% this year, slowing to 2.8% in 2028. Interest rates are predicted to edge down slowly, with the main rate averaging 3.76% in 2026 and reaching 3.5% by 2028.
The survey shows a consensus that inflation will remain slightly above the NBP’s 2.5% target but within a manageable range. The main risks to this scenario are a renewed rise in energy prices or persistently high fiscal deficits.
Poles remain cool on the euro
According to the latest Eurobarometer survey, only 43% of Poles support adopting the euro, a drop of three percentage points from last year. Opposition stands at 56%. The sentiment is mirrored in the Czech Republic, where 58% oppose the single currency. In contrast, Hungarians are enthusiastic: 80% now favor joining the eurozone, up from 75% a year ago, reflecting a backlash against the previous government’s eurosceptic policies and the painful experience of high inflation and a weak forint.
Despite public support, Hungary remains far from meeting the convergence criteria. The European Central Bank report notes that Budapest fails all four tests: high public debt, excessive deficit, above-target inflation, and volatile exchange rates. The Hungarian central bank law is also not compliant with eurozone rules.
Global energy shocks: russian refinery hit, heatwave spike
Ukraine’s drone attacks in June have severely damaged the Moscow refinery, a key facility supplying fuel to the Russian capital. Sources told Reuters that repairs will take at least six months, meaning the refinery is likely to remain offline for the rest of 2026. The loss of 2.9 million tons of gasoline and 3.2 million tons of diesel capacity has exacerbated shortages across Russia, forcing the government to consider banning diesel exports and even importing fuel.
Meanwhile, a record heatwave in Western Europe is driving up electricity prices. Temperatures exceeded 44°C in France, forcing EDF to cut nuclear output by 4.1 GW due to water cooling restrictions. Renewable generation also suffered from low wind speeds. German day-ahead prices soared above €500 per MWh in the evening, and Polish spot prices briefly exceeded 2,700 PLN per MWh. While most household tariffs remain fixed, industrial consumers are feeling the pinch, and prolonged heat could feed into broader inflationary pressure.
Źródło: WNP.PL, Fot. PAP/Radek Pietruszka
