Fuel Price Surge Strains Kosovo Businesses, Farmers

A leading snack manufacturer in Kosovo is facing mounting financial pressure due to a sharp rise in fuel prices, highlighting the wider economic impact of global geopolitical tensions.

Kushtrim Ajvazi, a manager at Pestova, said the company—known for producing Vipa potato chips—has been significantly affected by increased fuel costs. The company operates nearly 100 acres of potato fields in eastern Kosovo and distributes its products widely across local markets and exports internationally.

Fuel prices have surged dramatically, rising from €1.10 per liter to as much as €1.70. This increase has disrupted both production and distribution, as Kosovo relies entirely on imported fuel. While importer profit margins are capped at 12%, businesses are still struggling to absorb the higher costs.

Ajvazi emphasized that the company is under pressure, especially during the spring planting season, which requires heavy fuel usage. Although fertilizer prices have also increased, existing reserves have helped mitigate some of the impact. However, the continued rise in operational costs may force the company to increase product prices.

“We are carefully evaluating every additional expense. If costs continue to rise, adjusting prices will become unavoidable,” Ajvazi said.

The situation is further complicated by export agreements. Around 40% of Pestova’s production is sold internationally under fixed-price contracts, which can only be revised with a 90-day notice, making short-term financial planning difficult.

Ajvazi has called on the government to introduce support measures to ease the burden on businesses and farmers. Unlike neighboring Balkan countries such as Romania, Hungary, and Serbia, which have implemented fuel subsidies or tax relief for farmers, Kosovo has yet to take similar action.

Economic experts warn that urgent government intervention is necessary to prevent further damage. Economist Safet Gerxhaliu noted that the price surge is impacting all sectors of the economy.

The fuel crisis is also affecting consumers. Bardh Mehmeti, an IT professional from Pristina, said the cost of filling his car has increased from €80 to €100, prompting him to consider switching to an electric vehicle.

Kosovo’s economy has faced ongoing challenges since its 2008 independence from Serbia, including political instability and stalled European Union integration efforts. Recent political deadlock has further complicated the government’s ability to respond effectively to the crisis.

Opposition parties have criticized the government’s inaction, urging temporary tax cuts and immediate measures to support both businesses and citizens during this period of economic strain.