Employers slammed the fuel hike that took effect yesterday as untimely while trade unions called for full compensation.
The price of petrol rose by 4c to €1.38 per litre while that of diesel went up by 3c to €1.31.
The employers said this will have a negative impact on many businesses and a snowball effect on inflation and the cost of living.
It said rather than higher prices, there should be a concerted effort to reduce operational costs at Enemalta, coupled with a more effective purchasing strategy of fuel, including investment to increase the storage capacity.
The Malta Employers’ Association said the increase in fuel prices would affect many companies directly through higher transport costs, particularly in the distributive trades.
“The chain reaction will generate higher inflation which may translate into a higher cost-of-living adjustment for employers in the next Budget,” it said.
Announcing the higher fuel prices on Thursday, Enemalta Corporation attributed the hike to the rise in the cost of crude oil due to the turmoil in the Arab world as well as to the higher mark-up, by 0c8, granted to petrol stations to upgrade their equipment in line with EU directives.
But the increases attracted the dismay of trade unions, with the General Workers’ Union saying it expected the government to shoulder most of the burden since a good percentage of the price was being taken by the government in tax.
It said a special Malta Council for Economic and Social Development meeting would be convened on April 13 to discuss a report on the impact of the fuel increases.The union said it was expecting the government to give fair compensation to make up for the costlier fuels.
The latest increase it said, would continue to cut into the purchasing power of workers and pensioners and raise the cost of essential services.
The Forum grouping 12 trade unions expressed frustration, sarcastically saying this had become a “monthly appointment”.
It said the price of fuel had increased three times in the last three months, and this would continue to impact prices.
It too is expecting some form of compensation. Alternatively, the government could reduce its tax on fuel, it said. The hotels and restaurants association joined the chorus of disapproval saying the increase in the price of thin fuel oil, widely used by hotels, would have a negative impact on the industry.
The cumulative rise in the cost of thin fuel oil over the past 13 months exceeded 50 per cent. The association also pointed out, this cost the hotel industry about €2.45 million, or €18,550 per hotel, in one year.
This increase did not only include the consumption of diesel and petrol which pushed up the cost of the fuel price increases to around €20,000 per hotel over the past year.