Italy Extends Diesel Excise Cut Until September 17

The Italian government has extended the excise tax cut on diesel fuel until Thursday, September 17. The measure provides a reduction of 14 cents per liter in tax, which translates to a lower pump price of approximately 17 cents per liter. This latest extension is funded by between 85 million and 100 million euros. The government intends for this to be the final generalized cut, as it seeks to transition toward targeted aid for low income households and professional drivers. However, the majority coalition has yet to reach an agreement on which specific categories to support or how to fund those measures.

Prime Minister Giorgia Meloni announced that the government will also appoint commissioners to help regions accelerate permits and concessions for the exploration and extraction of oil and gas. Meloni stated that increasing national production is necessary to reduce foreign dependence and ensure energy security. She also highlighted the government's progress in renewables and its openness to nuclear energy.

Financial pressure is mounting as fuel supports have cost between 2 billion and 2.6 billion euros since March. The government is awaiting Istat data on September 22 to see if the deficit to GDP ratio has fallen below 3 percent, which would provide more budgetary room. Potential funding sources under discussion include contributions from banks or a tax on the windfall profits of energy companies, though the latter faces strong resistance from some political parties and businesses.

Consumer groups have criticized the extension as insufficient, calling for larger discounts and the inclusion of gasoline. Meanwhile, global energy prices remain volatile due to conflict in Iran, with crude oil and gas prices rising significantly compared to pre war levels.