Rising oil prices / Albania is losing at least one million euros per day from purchasing fuel abroad

The line of vehicles has increased at the fuel station in Tuz, near the Murriqan customs point, which connects Montenegro with Albania.

Most of the residents in the surrounding area cross the border and refuel there, as fuel is much cheaper than in Albania. Yesterday, one liter of diesel was sold in Montenegro at €1.57, while in Albania it was 214 lekë, or about €2.2 at the current exchange rate.

With 2,000 lekë, in Albania you can buy 9.3 liters of diesel, while in Montenegro, with the same amount (after exchanging), you get nearly €21 and can buy 13.1 liters, or 42% more. The price difference is so high that it justifies both the time spent and the extra fuel used to travel to the border.

Not only residents of nearby areas, but also citizens of Shkodër have turned Montenegro into a preferred destination. Koçi, together with his wife, goes to Podgorica every two weeks.

On the way, they fill up the tank, but don’t stop there, they also buy groceries in supermarkets. A jar of yogurt costs €1.3, while the same product in Albania is 70% more expensive. Milk is also cheaper, as are flour, oil, and canned products.

Above all, they say that besides being cheaper, the products are also of better quality. Data from Eurostat shows that food prices in Albania are close to the European average (98.7%), while in North Macedonia they are 73% of the EU average and in Montenegro 82.6% (latest data for 2024; no data for Kosovo). Milk, cheese, and eggs are even 31.5% more expensive than the European average.

No one has precisely measured how much the Albanian economy is losing due to price differences with neighboring countries, which are shifting consumption of both fuel and other products abroad to Montenegro, Kosovo, and North Macedonia.

This phenomenon potentially translates into loss of fiscal revenues, a contraction of domestic consumption, pressure on local businesses, and a lower contribution to GDP growth, due to the transfer of spending outside the Albanian economy that would otherwise remain within the country.

The Hydrocarbon Association estimates that about 300–500 tons of fuel per day are purchased by Albanian customers in border areas. In addition, another 120–300 tons per day are considered lost consumption from foreign citizens, who would potentially buy in Albania but instead refuel at border entry and exit points.

The Association calculates this lost consumption based on daily vehicle crossings in border areas, the number of tourists and trucks entering and leaving with foreign plates, and comparisons between the number of vehicles and consumption levels in border areas versus inland areas, as well as sales data from fuel stations near Albania’s borders with the three neighboring countries.

According to data from the Ministry of Finance and Customs, annual fuel consumption in Albania is about 740,000 tons per year, or around 2,000 tons per day (which, at the current price of 214 lekë per liter, translates into consumption worth about €5.2 million per day).

Estimates suggest that fuel purchases in neighboring countries account for around 15–25% of total domestic consumption.

By converting 500 tons into liters, and using an average price of €1.5–1.6 per liter, it is estimated that around €1 million per day is currently leaving Albania for fuel purchases in neighboring countries, or over €350 million per year.

While higher food prices are linked to a lack of competitiveness and heavy reliance on imports, turning the economy into a large supermarket, for fuel, one of the main reasons is the high tax burden applied to each liter.

Currently, an Albanian pays €1.16 in taxes per liter of fuel (53% of the final price); a North Macedonian €0.58 per liter (36%); a Montenegrin €0.55 (35%); and a citizen of Kosovo €0.67, or 38.5% of the final price. In North Macedonia and Montenegro, fuel is currently sold at around €1.6 per liter. In Kosovo, prices recently rose to €1.7–1.8 per liter, while in Albania it is €2.2 per liter.

In absolute terms, every time an Albanian buys a liter of fuel, they pay about twice as much tax as residents of Kosovo, Montenegro, and North Macedonia.

The state could collect nearly the same revenue if it reduced taxes and increased consumption.

If prices were at levels similar to the region, consumption would concentrate domestically and increase by 25–30%, reaching close to 1 million tons per year. This increase would likely compensate for the reduction in the fiscal burden on fuel.

In 2025, with current consumption of 740,000 tons per year and an average price of 175 lekë per liter, Albanians were estimated to have spent around €1.5 billion on fuel, half of which was taxes. This year, if taxation remains unchanged and consumption stays the same, spending is expected to reach €1.7–1.8 billion annually, with an average price between 200–214 lekë per liter, of which the state would collect about half (around €900 million).

If, for example, the circulation tax were removed, reducing the price by about 30 lekë per liter, bringing it to around 180 lekë per liter, consumption would increase to €2.1 billion, and the state would collect about 40%, or roughly €850 million, significantly offsetting the loss from removing the circulation tax.

“KORÇA BOOM”