Diesel in Spain is cheaper than petrol again for the first time since March

The change follows new tax discounts introduced at Spanish petrol stations on 1 September. The rebate on the Special Tax on Hydrocarbons (IEH) for diesel increased from 10 cents per litre in August to 20 cents, while the reduction for 95-octane petrol was cut to five cents.

The resulting difference is currently just one cent, but it could mark the start of a change in the recent price trend. The figures come from the Ministry for Ecological Transition's petrol station geoportal.

Diesel has fallen from a peak of 1.942 euros per litre recorded on 21 March, while petrol is now closer to its record price at that time, at 1.796 euros per litre. Diesel has fallen by around seven cents, offering some relief to motorists after filling a tank became 20 euros more expensive between 30 June and 31 August, the two months when travel typically increases because of the summer holidays. For petrol vehicles, the additional cost was 15.5 euros.

The fall in diesel prices has been smaller than the 10-cent reduction in the IEH might suggest. One factor is VAT, which is also calculated on both the fuel price and the tax itself. Petrol has moved in the opposite direction, rising from around 1.74 euros per litre on Monday to about 1.79 euros. The increase broadly reflects the reduced tax rebate in place until the end of August.

The tax measures have not yet been enough to contain rising fuel prices, largely because of the international oil market. Crude oil returned to above 90 dollars this week after slight falls during the final week of August, with international prices ultimately influencing what motorists pay at the pumps.

"It's more than likely that, if the upward spiral in the international price of diesel continues, these increases will end up eating into the flat-rate IEH reduction on diesel currently in force," the Spanish Confederation of Service Station Operators (CEEES) said.

The organisation had called since the beginning of summer for the 10 per cent VAT rate on motor fuels to be extended.

The new diesel discount has also caused controversy. Fenadismer, the Spanish Federation of Transport Associations, said on the first day of the 20-cent tax reduction that some filling stations were not passing the full saving on to motorists.

CEEES said the new discounts were being applied "by the vast majority of stations and on a widespread basis". It argued that the new IEH rate applied to diesel products bought and delivered to service stations from Tuesday onwards, making it impossible for every station to empty its tanks before midnight on 31 August and refill with fuel subject to the new rate by midnight on 1 September.

According to the organisation, the reduction should therefore become increasingly visible at the pump as stations replenish their stocks with fuel subject to the September tax rate.