Hungary decides not to hike gas prices in April - minister

The Hungarian Energy Office (HEO) proposed not to raise gas prices as of April, MTI cited Molnár as saying. He noted that since the office made its suggestion (at USD/HUF of 228), the situation “has worsened somewhat", as the forint weakened over the past days.

The forint eased about 16% against the greenback in the past three months, while global crude oil prices plummeted to about USD 40 a barrel from last year's record highs.

Molnár indicated that “a hike would be needed apparently", but two factors convinced the government not to take this step.

1) the forint is likely to regain some strength in the period to come;

2) the impact of the sharp fall in oil prices (that started last autumn) will already be palpable in the wholesale price of gas as of April.

Regarding the second point Molnár underlined that due to the pricing model (which factors in a nine-month delay to dampen the impact of changes on external markets), the impact of the global price fall should be first experienced in the third quarter (i.e. from July). (According to press reports, the import price of gas will drop from the current USD 475 per 1,000 cubic metres to USD 365 in April and to around USD 260 in July.)

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