Fuel prices at German petrol stations have risen sharply following the expiry of the fuel tax discount. As early as Tuesday midday, while the tax cut on diesel and petrol was still in effect, petrol stations across the country raised their prices significantly, the ADAC (Germany's automobile association) reported on Wednesday. Prices then fell only slightly, before rising sharply again on Wednesday midday. Both the ADAC and the Monopolies Commission sharply criticized the oil companies.
Since April, petrol stations have only been allowed to raise their prices at midday, while price cuts remain possible at any other time of day. On Tuesday midday, the price increase was particularly steep, at 20.3 cents for petrol and 24.0 cents for diesel. Petrol subsequently cost an average of 2.033 euros per liter, and diesel 1.990 euros.
Over the following 24 hours, prices then fell only slightly, by 6.5 cents for petrol and 8.4 cents for diesel. On Wednesday midday, the next price jump followed, of 18.2 cents for petrol and 20.4 cents for diesel, meaning both types of fuel cost well over two euros per liter on average nationwide by Wednesday midday.
Price increases had been expected because of the expiry of the fuel tax discount. The tax cut, in effect since early May and totaling almost 17 cents per liter, lapsed overnight into Wednesday. However, because the midday rule means petrol stations may only raise prices at noon, an earlier price increase the day before had also been anticipated.
Nevertheless, the price increases actually began even earlier. In the final days of the tax discount, only seven to eleven of the 17 cents were passed on to consumers, explained Tomaso Duso, chairman of the Monopolies Commission. "In recent days, oil companies have apparently used the foreseeable expiry of the discount to deliberately expand their margins."
Duso added that this was "alarming" from a competition policy standpoint. "Because the energy tax is levied when fuel leaves the refinery or storage stage, a gradual price increase would therefore only have been expected after the discount had actually expired." He also noted that many consumers had filled up their tanks once more shortly before the discount ended, temporarily boosting sales and profits for the companies.
The ADAC likewise criticized that the expiry of the fuel tax discount had been "unjustifiably pre-empted." Prices should not have risen so sharply beforehand, the association said, since in many places petrol stations still had "more cheaply taxed fuel in their tanks."
"Given the overall stable crude oil price in recent days, and the fuel price level at the pump that has long been excessive anyway, this practice must be sharply criticized from the ADAC's point of view," the Munich-based automobile club stated. "A comparison with fuel prices from the previous week also shows just how sharply the oil companies are driving up prices, despite unchanged underlying conditions, particularly regarding the oil price and the euro-to-dollar exchange rate."
Ramona Pop, head of the Federation of German Consumer Organisations (Verbraucherzentrale Bundesverband), described the situation as a "rip-off": "This cannot be allowed to continue," she said. "Crude oil prices are now back at pre-war levels, but petrol station prices remain well above that." She said the Federal Cartel Office must now take a close look and act against unjustified price increases.
The oil companies pushed back against the criticism. "We firmly reject the accusation that the industry has charged excessive prices in recent months in connection with the Middle East crisis and the fuel tax discount," said Christian Küchen, managing director of the Wirtschaftsverband Fuels und Energie (Fuels and Energy Industry Association).
The Federal Ministry for Economic Affairs also pointed to the Cartel Office's role: "Investigations are underway relating to refinery operators, to petrol stations, and to the distribution structures involved," a ministry spokesperson said.
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