HELSINKI, March 23 (Xinhua) -- The Swedish government on Monday announced a 4.7-billion-krona (about 500 million U.S. dollars) relief package to help households cope with economic turbulence linked to the Middle East conflict and broader regional instability.
"What is happening in the Middle East and in the wider world is putting Sweden's economy to the test," Prime Minister Ulf Kristersson said at a press conference.
The package includes a temporary cut in petrol and diesel taxes to the minimum levels permitted by the European Union (EU). The measure, which will apply from May 1 to Sept. 30, is expected to lower petrol prices by about one krona per liter and diesel prices by 0.4 krona per liter compared with what they would otherwise have been, Swedish Television (SVT) reported.
The fuel tax cut is expected to cost the state 1.5 billion kronor. The government also said it would seek permission from the European Commission to reduce fuel taxes further if necessary.
The package also expands previously announced support for households facing high electricity prices. Compensation will be provided nationwide for electricity costs incurred in January and February.
The government said it would allocate 2.4 billion kronor in electricity and gas support for households through the spring amending budget, in addition to 1 billion kronor already included in this year's budget. The support, based on household energy consumption in January and February, will be paid automatically by the Swedish Social Insurance Agency in June.
"The support is based on previous consumption, but it is really about helping households manage the current economic turbulence," Energy Minister Ebba Busch said, adding that the government was prepared to introduce further measures if necessary.
The package also includes new subsidies for government agencies choosing fossil-free and electric alternatives, as well as an additional 100 million kronor in support for electric vehicles.
Commenting on the announcement, daily newspaper Svenska Dagbladet said the government had made no mention at the press conference of the U.S. decisions that incurred the current economic situation. He described the measures as "like putting a Band-Aid on an amputated foot."
The United States and Israel launched massive attacks on Iran on Feb. 28, disrupting global shipping, sending oil prices soaring and shaking the global economy.
Fuel prices in Sweden have risen since March, according to SVT. Data updated on March 16 showed that the average retail price of 95-octane petrol in Sweden stood at 18.49 kronor per liter, while diesel averaged 22.34 kronor per liter. Industry sources said fluctuations in international oil prices, exchange-rate movements, geopolitical tensions and Sweden's relatively heavy tax burden were among the main factors pushing up fuel prices. (1 Swedish krona = 0.11 U.S. dollar)
