Butane cylinder prices set to rise in February

Consumers who rely on butane cylinders will pay more in the coming weeks, with costs set to rise in February.

In mid-January, the price of butane cylinders saw a notable increase, impacting households that depend on butane for cooking and heating.

The latest revision, setting the price at €15.89, marks a rise above the rates of preceding months. This increase in cost is expected to last throughout February.

Price regulation and its impact

While inflation has affected Europe with price hikes for electricity, tobacco, shopping and petrol, butane cylinders have generally maintained their prices due to the limitation imposed by Spanish law, something that is set to continue in 2024

The Spanish Government, on June 25, 2022, implemented a decree law capping the price of butane cylinders weighing between eight and 20 kilograms at €19.55.

This measure, extended until the end of 2023, was part of a broader package of anti-crisis strategies adopted by the last Council of Ministers in 2023. It aimed to alleviate the financial strain on families by maintaining a ceiling on butane prices.

Factors influencing butane pricing

The determination of butane cylinder prices hinges on multiple factors. The primary influencer is the international market cost of raw materials, namely propane and butane.

However, additional elements such as freight costs and the euro-dollar exchange rate fluctuations also play a crucial role.

After Russia’s invasion of Ukraine, the Government imposed a 5 per cent limit on price adjustments during reviews. Consequently, ‘the butane cylinder cannot rise or fall more than the percentage established by law’, ensuring some stability for consumers amid market volatility.

Taxation and additional charges

In calculating the final price of a butane cylinder, one must account for VAT, currently at 21 per cent, and the Special Tax on Hydrocarbons (IEH), charged at €1.5 per kilo. These additions, alongside the raw material and transportation costs, contribute to the final retail price.