Latvia could suspend mandatory biofuel blend to slow inflation

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It is planned to temporarily waive the requirement for the mandatory addition of biofuels to gasoline and diesel, said Ilze Indriksone, Parliamentary Secretary of the Ministry of Economics (EM), following a meeting of the parties on May 2.

The decision was scheduled to be taken until July 1. It is currently planned that biofuel will not be mandatory until the end of 2023. 

Indriksone said that EM viewed “all possible” ways of supporting residents and entrepreneurs during the increase in energy prices. Abandoning the mandatory biofuel blend could reduce the price of gas provisionally by 12-14 cents per liter. 

In 2020, the minimum amount of biofuels added to diesel in Latvia was increased from 5% to 7%, while for gasoline 95 from 5% to 10%. From November to early April, bio is optional for diesel.

The Ministry of Finance has forecast that inflation growth can reach 8.5% this year, but according to the Bank of Latvia's forecasts, inflation may rise to 9.5%.

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