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Hungary Forced to Pull Back on Huge Gas Price Boost : Eastern Europe: Taxi drivers, truckers agree to suspend a crippling blockade. The pressure is on Parliament to resolve the crisis.

October 29, 1990|CAROL J. WILLIAMS | TIMES STAFF WRITER

BUDAPEST, Hungary — Striking taxi drivers and teamsters who paralyzed Hungary for three days by barricading roads, bridges, borders and public transport agreed Sunday to suspend their blockade while Parliament wrestles with a fuel crisis that threatens an economic collapse.

The stopgap compromise was expected to restore some semblance of order on Hungarian roads today after a virtual halt to vehicular movement over the weekend.

But the strike was just the beginning of what promises to be a long winter of turmoil for the nations of Eastern Europe hit by Soviet oil cutbacks at the same time that world prices have soared because of the Persian Gulf crisis.

The choice for Hungarian motorists boils down to expensive gasoline or no gasoline at all, the government warned.

In the compromise agreed to late Sunday, the government agreed to scale back a huge increase that had raised the price of gasoline to $3.80 a gallon. The price will be set at about $3 starting Tuesday until the sharply divided Parliament can sort out the conflict.

Trade and Industry Minister Peter Akos Bod warned that Hungary has only about four days of fuel in reserve and could run out within hours if panic buying ensues on Tuesday.

Unlike the other nations of Eastern Europe, which have raised gas prices gradually or invoked rationing in recent months, the Hungarian government took no steps to reduce consumption and instead tapped fuel reserves to continue supplying gasoline at subsidized rates.

By delaying imports and exhausting reserves, Hungary was forced last week to buy oil on the expensive spot market and to institute a 65% price boost for gasoline.

The surprise announcement Thursday that top-grade fuel would rise from about $2.30 a gallon to $3.80 at midnight triggered the blockade that ground Hungary to a halt.

The government's handling of the gas crisis has come under harsh attack in the media and from the opposition Alliance of Free Democrats, who charged that the leadership is incapable of guiding Hungary out of economic disaster.

Prime Minister Jozsef Antall has been hospitalized for nearly a week after surgery to remove a tumor. He has left the job of negotiating an end to the traffic blockade to Cabinet members.

Antall went on national television late Sunday night from his Budapest hospital room, telling Hungarians during a 45-minute explanation of the crisis that he had been assured of foreign aid to prevent insolvency.

Hungary labors under the weight of $20 billion in foreign debts. Interest payments on those loans are draining the nation of hard-currency resources.

Germany said Sunday that it is considering shipping fuel to Hungary to help stave off a government crisis. Both Bonn and the European Community planned to send delegations to assess the situation today.

Suggestions that Western sympathies are with the government in the standoff may have encouraged the drivers to accept the interim compromise they had steadfastly rejected a day earlier.

Hungarians initially expressed solidarity with the strikers, but tensions mounted over the weekend as consumers tired of the inconvenience and began to fear shortages of food, empty gas tanks and lost income from being unable to get to work.

Bread and milk supplies dwindled as shoppers stocked up and roadblocks prevented some deliveries.

A demonstration against the strikers called by Antall's party drew nearly 20,000 people to a march between Parliament and blockade sites, with those angered by the strike shouting "Roads and bread!" "We want order!" and "Taxi drivers go home!"

One of Hungary's most revered figures condemned the strike as a desperate and dangerous act.

"This is a form of terrorism," Transylvanian Bishop Laszlo Tokes told Hungarian radio. "It is not legal what the strikers are doing. This is a nation committing suicide."

Sensing a swing in the public mood, the Free Democrats also softened their earlier stand in support of the strikers.

"We, of course, recognize the necessity of price rises and anti-inflation policy. What we don't agree with is the government's waiting for seven months, then shocking the public without any warning," said Free Democratic Parliament member Gaspar Tamas. "We recognize the fact that the protest was justified without saying we were protesting the price rises."

Parliament will be under intense pressure to resolve the crisis before gas supplies are exhausted. But the deputies are sharply divided in political camps, offering little promise of a speedy solution.

The strikers eased their blockade several hours before Sunday's temporary agreement, allowing emergency vehicles and some traffic across the six bridges spanning the Danube River, which bisects the Hungarian capital.

Only the small subway network--with only one line carrying traffic beneath the river--operated normally Friday and Saturday.

Barricades of parked taxis, delivery vans and tractor-trailer trucks prevented access to airports, forcing travelers to walk miles with their luggage.

Malev Hungarian Airlines said 40% of its passengers missed their flights.

Gas stations and border crossings were also blocked during the height of the strike to prevent private car owners from tanking up or buying gas in neighboring countries.

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