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Spanish petrol consumption drops due to new speed limit

Spanish motorists consumed 7.9 percent less fuel in March year-on-year after a contested new highway speed limit came into place, Industry Minister Miguel Sebastian said Thursday.

The drop in fuel consumption led to a reduction in the country's fuel bill of 94.2 million euros (138.3 million dollars), he told a news conference.

Spain cut its speed limit from 120 kilometres (75 miles) per hour to 110 kph last month as part of a package of 20 energy-saving measures intended to offset rising oil prices and protect the country's fragile economic recovery.

The reduced speed limit came into effect on March 7, three days after it was announced, and it will remain in place until at least June 30.

The government will decide at the end of June whether or not to keep the lower speed limit in place for longer, Sebastian said.

"Faced with a rise in the price of oil, Spain has no other margin of manoeuvre than to reduce its consumption," he told a news conference.

Those exceeding the limit and driving below 140 kph are subject to a fine of 100 euros while those driving faster than 140 kph will face a 300 euro fine.

About 69 percent of Spaniards disapprove of the measure, according to a poll in the El Pais newspaper.

Spain's two-time Formula One world champion Fernando Alonso has also blasted the new limit, warning that it will be "difficult to stay awake" at this speed.

Alongside the lower speed limit, Spain has cut the price of commuter and short-distance rail tickets by 5.0 percent and introduced susbisidies for purchases of special tires designed to reduce car's fuel consumption.

Sebastian said the other energy-saving measures would take longer to implement and its effects on energy consumption will not be as immediate.

Spain is almost completely dependent on imported fuel for road transport, although a fifth of its electricity output is generated by wind power, and the spike in oil prices has added to pressures on inflation and the trade deficit.

Each increase of 10 euros in the cost of a barrel of oil adds some six billion euros to the country's annual energy bill, according to government calculations.