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COST OF LIVING

Where in Switzerland can you find the cheapest fuel?

Fuel prices are skyrocketing throughout Switzerland. But there are ways to save money at the pump — here’s how.

Fuel prices in Switzerland, though high, are less expensive than in neighbour countries.
Petrol is expensive in Switzerland but there are ways to save money at the pump. Photo by Skitterphoto on Pexels.

Fuel – i.e. gasoline, petrol, diesel – has always been expensive in Switzerland and it is becoming even more costly to fuel up.

The price jumped from 1.40 to 1.80 francs per litre in 2021, according to Roland Bilang, director of Avenergy Switzerland, formerly the Swiss Petroleum Association.

Fuel cracked the CHF2 per litre mark in early 2022, due at least in part to Russia’s invasion of Ukraine.

Experts warned in early March that the CHF3 per litre mark was not out of the question due to the ongoing international turmoil. 

This difference of 40 cents represents an increase of 20 francs to fill an average tank.

READ MORE: Why is Switzerland about to become even more expensive?

Several factors account for the climbing costs of fuel

The Ukraine conflict has seen a worldwide spike in oil prices, which has flow-on consequences for prices at the pump. 

Another factor is that demand remains stronger than supply, which increases the prices, said Laurent Pignot, spokesperson for motoring organisation Touring Club Suisse (TCS).

Switzerland imports nearly half of its crude oil from Africa; the remaining half comes from Mexico, the United States and Kazakhstan, according to government figures.

Another reason for rising prices is the cost of transporting oil on the Rhine. “As the level of the river is low, the boats cannot be fully loaded and have to make more round trips”, Pignot pointed out. 

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“Consequently, the price of gasoline increases by a cent per litre”, he added.

Also, since January 1st, gasoline in Switzerland has been taxed an additional 3.7 cents per litre to finance environmentally friendly fuels.

However, even with price hikes, filling up a tank is still cheaper in Switzerland than in neighbouring countries, which is unusual, as prices for most goods are lower across the border. 

A reason for this is comparatively lower tax rates on petrol in Switzerland. Only Austria has lower fuel taxes than Switzerland (among Switzerland’s neighbours). 

But cross-border shopping trend is reversed when it comes to gasoline.

“German, but above all French, ‘fuel tourists’” get their petrol in Switzerland, Blick reports.

So if you’ve been crossing the border to go shopping, fill up your tank when back on Swiss territory if you want to save. 

Can you save money on petrol in Switzerland, and if so, how?

Petrol distributors and stations compete with each other, which is good news for consumers.

RTS public broadcaster analysed petrol prices at various stations in several regions and found lowest prices at Rasthof Platenenhof station in Gampelen (BE).

Another cheap fuelling option is a few kilometres away, at the Pit-Stop de Boudevilliers in Val-de-Ruz in canton Neuchâtel.

In fact, RTS reported that this whole region benefits from cheaper gasoline due to its proximity to the Cressier-Cornaux refinery and large volume of purchases.

Another low-cost location is in Samnaun, canton Graubünden in the region of Engiadina Bassa / Val Müstair.

The price there is 30 percent cheaper than on the notoriously expensive Lake Geneva region.

The reason for this price disparity is that this community of just over 700 inhabitants is a historic fiscal enclave that does not apply VAT or other taxes.

Other options include EK Automobile in Kestenholz, Solothurn and Tankstelle Fiechter in Teufenthal, Aargau.

But what if you don’t live in these areas?

You can still save some money on petrol if you do your research and know where the best (meaning: cheapest) places are to fuel up in your region.

Here are some tips:

Autoclub memberships often offer discounts on petrol. ACS members and TCS members can save between two and five cents per litre. 

Larger petrol retailers will also often have discount deals, while Swiss supermarkets also offer deals with particular gas station chains. 

Prices are usually the highest on (or close to) motorways, in or near large cities, and at branded chain stations. You can find better deals at smaller, independent stations away from main roads.

However, you should avoid going too far out of your way to save on fuel.  

“A one-cent difference on the price of the litre justifies a detour of  two to three kilometers, at most. Otherwise, the excess consumption drowns the economy on a 50-litre tank”, said TCS’s Erich Schwizer.

One useful website listing cheaper petrol options throughout Switzerland is this.

READ MORE: How can you save on your household energy bills in Switzerland

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COST OF LIVING

EXPLAINED: What the steep rise in Swiss interest rates could mean for you

The Swiss National Bank (SNB) raised the key interest rate by 0.75 percentage points, putting it back in positive territory at 0.5 percent.

EXPLAINED: What the steep rise in Swiss interest rates could mean for you

As announced by Switzerland’s central bank on Thursday, the rate change applies from Friday, September 23rd.

“The bank’s aim is to counter the renewed rise in inflationary pressure and the spread of inflation to goods and services that have so far been less affected”, according to SNB.

The SNB has not said how long the current rate will be in place, but noted that “it cannot be ruled out that further increases in the SNB policy rate will be necessary to ensure price stability over the medium term”.

READ MORE: Swiss central bank announces big rate hike in inflation fight

Inflation rate in Switzerland currently stands at 3.5 percent. While it is much lower than in the eurozone, where it exceeds 9.1 percent, it is still higher than its usual rate of below 1 percent.

Why has the SNB raised the interest rate for the first time since 2015?

For the same reason that other central banks have done so, including the European Central Bank and the Federal Reserve in the US: price stability

In general, central banks see increasing interest rates as a response to rising inflation: higher rates help reduce the overall level of demand and, subsequently, also the upward pressure on prices.

Whether this strategy will work is another matter.

The SNB rate hikes will “have a fundamentally dampening effect on inflation”, Felix Oeschger, analyst at Moneyland price comparison platform, told The Local.

“However, it is far from clear whether these alone will be enough to curb inflation”, he added.

One for the reasons for this uncertainty, Oeschger said, is that “the energy crisis and the high prices of some agricultural commodities, such as wheat, are a result of the Ukraine war. These prices are more difficult to influence with key interest rate increases”.

In its inflation forecast, the SNB predicted the inflation will drop to 2.4 percent in 2023.

But “considering that the SNB has continuously revised its inflation forecasts upward since December 2021, it is quite conceivable that inflation in Switzerland will continue to rise or at least remain high”, Oeschger pointed out.

READ MORE: EXPLAINED: The groups most affected by inflation in Switzerland

Will the Swiss consumers benefit (or not) from the higher interest rates?

It depends on what you are looking to buy.

If you are planning to buy big-ticket items that are usually purchased with credit — like homes — then you may have to dig deeper into your pockets.

If you already have a fixed-rate mortgage, then you are safe from rate increases for the term of your mortgage.

But for new buyers or those with variable-rate mortagages, things may be more problematic.

“It is not excluded that mortgage interest rates will reach 3 to 4 percent next year”, from the current 2.6 to 3.1 percent, according to Donato Scognamiglio, director of real estate platform Iazi.

What about rents?

Tenants may not be better off than homeowners.

Many have already received notices of higher rents to compensate for increased costs of energy.

Now another charge could be added as well, though probably not immediately.

“Rents will go up, but only when the reference interest rate itself is raised”, Scognamiglio said.

The benchmark interest rate is the average of all mortgage interest rates. If the reference rate increases by 0.25%, tenants will have to pay 3 percent more rent. “I expect this to happen next year”, he said.

But it is not all bad news; higher interest rates will yield some benefits as well.

For instance, if you have certain types of investments, you may see more money coming in.

“I expect yields on fixed-income financial products such as bonds to continue to rise”,  Oeschger said.

“In the case of medium-term notes issued by Swiss banks, we have already seen significant increases since the beginning of the year”, he added.

As for savings accounts, however, “the banks have so far been very hesitant to raise interest rates, but if monetary policy tightens further, we can expect interest rates to rise slightly here as well”.

Generally speaking, what will become cheaper and more expensive for consumers?

The bad news here is that everything that has to do with energy, even indirectly, will become more expensive.

This includes “heating, transport costs, electricity and also food”, another Moneyland expert, Ralf Beyeler told The Local.

READ MORE: Pasta up by 13 percent: How food and energy prices in Switzerland are rising

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