Spain Caps Gas Price Hikes at 15%, Extends Fuel Discounts Amid Middle East Conflict

Spain's government has announced plans to limit natural gas price increases by 15% and extend fuel discounts to protect consumers from the rising energy costs following the Middle East conflict. The measures aim to 'extend and adapt' support introduced in March, when global energy markets were plunged into turmoil after US-Israeli strikes on Iran.

Economy Minister Carlos Cuerpo said the package will shield households and businesses from higher inflation, which rose to 4.9% year-on-year in September, the highest level since February 2023. The price of butane cylinders used for cooking and heating will be capped at 19.55 euros.

The government approved a discount of 20 euro cents per litre of petrol and diesel in October, which will decrease to 13 euro cents in November and six cents in December. However, a 'reactivation clause' will allow the discounts to increase if prices spike by more than 15%.