Dutch government faces pressure for action as fuel prices surge

ISTANBUL

Pressure is increasing on the Dutch government to take swift action against rising fuel prices driven by the ongoing armed conflict in the Middle East, as lawmakers prepare to debate the issue in parliament, local media reported on Tuesday.

Several political parties are expected to call for urgent measures, arguing that other European countries have already moved to shield consumers from soaring costs, including by cutting value-added tax (VAT) or excise duties on fuel, the Dutch news broadcaster NOS reported.

The Dutch government, however, has so far refrained from introducing immediate measures, citing uncertainty over whether price increases are temporary or structural.

Prime Minister Rob Jetten said authorities would first assess whether the surge in fuel costs is lasting before taking action.

Meanwhile, high prices at the pump are putting pressure on consumers and the broader economy. In neighboring Belgium, where fuel prices are capped, lower costs have prompted Dutch drivers to cross the border to refuel, reducing domestic tax revenues.

Opposition parties have criticized the government’s cautious approach, with some proposing immediate tax cuts or price caps. GroenLinks-PvdA has called for introducing a ceiling on fuel prices, while other parties have suggested bringing forward previously planned reductions in excise duties.

However, policymakers warn that such measures could be costly and difficult to reverse. According to estimates, reducing excise duties by 10 cents per liter could cost the treasury around €1 billion (nearly $1.6 billion) annually.

The Dutch Central Bank has also cautioned against broad-based support measures, urging targeted assistance for low-income households instead.

The regional escalation in the Middle East has continued since the US and Israel launched a joint offensive on Iran on Feb. 28, so far killing over 1,340 people, including then-Supreme Leader Ali Khamenei.

Iran has retaliated with repeated drone and missile strikes targeting Israel and Gulf countries hosting US military assets.

The Strait of Hormuz has also been effectively throttled since early March. Around 20 million barrels of oil normally pass through it daily, and its disruption has driven up shipping costs and pushed global oil prices higher.