Austria Expands Petrol Price Brake, Reinstates Retailer Margin Cap

Austria's government announced on Wednesday that it will expand its petrol price brake, reinstating a cap on retailers' margins that was scrapped in June, as it seeks to shield consumers from rising oil costs linked to conflict in the Middle East.

The measure, first introduced in April, originally combined two equal components: a cap on retailers' margins and a cut in petrol tax, together worth 10 euro cents per litre. The margin cap was dropped two months later.

Under the revised plan, the petrol-tax cut will more than treble to 6.7 cents per litre from October 1, while retailers' margins will be reduced by 3.5 cents per litre. The government said the new rate will remain in place for two months, covering October and November, rather than the usual single-month extension.

Previously, on August 31, the conservative-led coalition had extended a smaller 1.9 cents per litre petrol-tax cut through the end of September. Each extension typically lasts a month, after which the three ruling centrist parties discuss whether and how to renew it.

Chancellor Christian Stocker said the escalation in the Middle East and the resulting pressure on fuel prices had prompted the fresh intervention. "The escalation in the Middle East and the resulting Trumpflation have again led to a significant rise in petrol prices. We are addressing this development with the new petrol price brake, which will bring down prices at the pump," he said.

The government has attributed stubbornly high inflation to US President Donald Trump over the Middle East conflict, which has disrupted oil flows through the Strait of Hormuz, referring to the phenomenon as "Trumpflation".

The announcement comes as Vienna balances consumer relief against pressure on retailers, with the reinstated margin cap marking a return to a tool it had abandoned earlier in the year.