Fuel prices in Albania and Kosovo are the highest in the region when measured against purchasing power, with the cost of filling a car taking a significantly larger share of daily income than in other Western Balkan countries.

In Albania, the real cost for consumers is even higher when the price at the pump is compared with incomes. A litre of diesel requires a much larger share of daily income than in most European countries, making it significantly more expensive to fuel a vehicle relative to earnings.

The price of a litre of diesel in Albania has reached ALL 229 (€2.46), making it the third-highest in Europe, after Denmark at €2.60 and Norway at €2.56. In the region, diesel costs almost €2 in Serbia, €1.87 in Montenegro, €1.76 in Bosnia and Herzegovina, €1.85 in Kosovo, while the lowest price is in North Macedonia, at €1.64.

The average diesel price across the European countries included in the comparison is around €1.94 per litre.

But the price at the pump is not the only indicator that matters. A litre of diesel costing €2.46 has a very different weight for an Albanian, a Dane or a Norwegian because of the large differences in income.

To measure this difference, Monitor compared diesel prices, based on prices published by Global Petrol Prices, with per-capita income published by the IMF for 2026, measured according to purchasing power parity (PPP). This indicator takes differences in price levels between countries into account and is used to make a more meaningful comparison of living standards and what people can buy with their incomes.

In Albania, per-capita income based on purchasing power is around $25,200 international dollars a year. Daily per-capita income is around $69.2, while a litre of diesel accounts for 3.56% of daily income, the highest level in Europe. (See chart: Share of daily income required to buy one litre of diesel.)

A Dane, in the country where diesel is the most expensive in nominal terms, needs 1.06% of daily income to buy a litre of diesel, while daily per-capita income stands at $245 international dollars, almost 10 times higher than in Albania. In Norway, which has the third-highest per-capita income in Europe in purchasing-power terms, after Ireland and Luxembourg, a litre of diesel requires 0.8% of daily income.

Across all European countries included in the analysis, the average share of daily income required to buy a litre of diesel is 1.36%. This means that, for an Albanian consumer, buying a litre of diesel requires around 2.6 times more daily income than for the average European consumer. The comparison includes all European countries covered by the analysis.

If the comparison is limited to EU countries, where per-capita incomes are generally higher than in the rest of Europe, the average is 1.14%. This means an Albanian must spend around 3.1 times more of their daily income to buy a litre of diesel than the average EU citizen.

Albania, Kosovo face the heaviest fuel burden in the region

Within the region, Kosovo ranks second after Albania in terms of the cost of diesel relative to purchasing power. A litre of diesel requires 3.1% of daily income measured according to purchasing power, also making Kosovo the second-highest in Europe.

Diesel in Kosovo is cheaper than in Albania, at €1.85 per litre, but Kosovo has daily per-capita income of nearly $60 international dollars, around 14% lower than Albania’s.

Bosnia and Herzegovina follows, with diesel accounting for 2.66% of daily income, while Serbia ranks next at 2.09%. The lowest burden in the region is in North Macedonia, where diesel is also the cheapest in nominal terms, and Montenegro, at 1.89% and 1.88%, respectively.

Taxes push up the price at the pump in Albania

Meanwhile, Albania continues to have the highest fuel prices in the region, partly because of its high tax burden, which accounts for nearly 50% of the price, as well as the lack of fiscal measures to ease the cost for consumers.

In the other countries of the region, the basic price of diesel is generally subject to excise duty and VAT. In some regional countries, excise duties are around 2% lower. In North Macedonia, VAT on diesel and petrol is 18%, but it was reduced to 10% during the period of rising prices.

Kosovo also applies an 18% VAT rate.

VAT in Montenegro is 21%, but diesel is subject only to VAT and excise duty, with the latter recently being halved as a measure to cushion rising prices.

In Serbia, VAT is 20%, while the excise duty had reached ALL 59.5 per litre before the outbreak of the war. Immediately after the conflict in the Middle East began, Serbia cut the excise duty by 25%. The measure was reactivated several weeks ago.

In Albania, in addition to the ALL 39.4 per litre excise duty, 20% VAT and the absence of fiscal relief measures, two additional taxes are also imposed on diesel that are not applied in the countries of the region: the ALL 27 per litre circulation tax and the ALL 3 per litre carbon tax.

Albania has no relief measures for diesel

Diesel in Albania has reached ALL 229 per litre, while petrol has risen to ALL 219, setting new record levels and increasing pressure on consumers and businesses.

According to data published by Monitor, fuel prices are rising while Albania has not introduced new measures to ease the impact on consumers. Meanwhile, the mechanism envisaged for a 20% cut in the excise duty remains limited in its application.

Under the scheme, the 20% excise reduction is activated when diesel exceeds ALL 220 per litre and petrol exceeds ALL 200 per litre, but the decision to apply it is linked to the functioning and decision of the Board.

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