Every time a German driver pulls up to the pump, they are paying a price that most of their European neighbours simply don't. Germany currently ranks 26th out of 27 EU countries for petrol prices - second most expensive in the entire bloc. That was already true before the current crisis. Now, with conflict in the Middle East disrupting global oil markets, the gap has widened sharply.
The escalating war in Iran has pushed fuel prices higher across Europe, but Germany has felt it more sharply than most, petrol has risen by almost 5% in recent weeks, well above the EU average. The contrast with neighbouring countries is striking. France and Austria have seen increases of around 2%, Estonia 3.6%, Luxembourg 3.5%, while Slovakia and Hungary recorded rises of just 0.1%.
The short answer is taxes - and lots of them. Around 64% of the price for petrol and 56% of the diesel price in Germany consist of taxes and duties, including energy tax, VAT and carbon tax. That structural weight means every time the crude oil price ticks upward, German drivers feel it more acutely than almost anyone else in Europe.
One of the biggest contributors is Germany's national carbon levy, introduced in 2021 as part of its climate policy. Since 2021, the CO₂ tax has risen steadily - from €25 per tonne at launch to €55 in 2025, a total increase of €30 in just four years. And 2026 brought further pressure: the system has now transitioned to an auction-based mechanism, with the price per tonne ranging from €55 to €65 - which, according to ADAC calculations, could add up to 17 cents per litre of petrol purely from the CO₂ surcharge.
The logic behind the carbon levy is straightforward: make fossil fuels more expensive to encourage drivers to reduce car use or switch to electric vehicles. But the practical effect - layered on top of existing energy taxes and VAT - is that German fuel prices are structurally higher than most of Europe, and more vulnerable to external shocks.
As of early March, Euro 95 petrol in Germany costs €2.075 per litre, that's 25.9% above the EU average of €1.648 per litre. The only EU country currently paying more is the Netherlands, where drivers are averaging €2.17 per litre. Germany sits close behind at €2.08, with Finland also in the upper range.
At the other end of the scale, Bulgaria offers the cheapest fuel in the EU at €1.27 per litre, reflecting a much lower tax burden.
The immediate trigger for the current spike is not just German tax policy. The conflict involving the US, Israel and Iran has disrupted oil supplies and driven up crude prices across Europe. The attack on Iran disrupted a key shipping route in the Strait of Hormuz, pushing crude oil above 90 US dollars a barrel.
What makes Germany's situation distinctive is not the crisis itself but the amplification effect of its tax structure. High base taxes mean any spike in crude prices hits the final pump price harder than in countries with lighter levies.
The political pressure on Berlin has become hard to ignore. Driving is woven into daily German life, commuting, school runs, shopping and the rapid price rises have triggered public frustration.
Economics Minister Katherina Reiche announced the government wants to allow price increases at petrol stations only once per day while permitting reductions at any time, following a system already in place in Austria. She also announced that Germany would release part of its national oil reserves to help stabilise prices.
The government has also formed a special task force. Its meeting included the German heads of BP and Shell, alongside Federal Cartel Office president Andreas Mundt, industry association representatives, consumer groups and the ADAC. The task force is now pushing the Cartel Office to expand its powers, including the ability to act against prices deemed excessive.
The industry, however, is pushing back. The managing director of the Fuels and Energy trade association told Tagesschau that margins had not changed since the start of the Iran war, and criticised plans to tighten antitrust laws.
Some EU member states haven't waited. Croatia and Hungary have both introduced price caps at petrol stations. In Croatia, prices initially rose by around four cents per litre, but a cap will limit further increases and fix prices at €1.50 per litre from 23 March. Austria, meanwhile, already limits petrol stations to one price increase per day, a model Germany is now eyeing.
Whether Germany follows with its own cap remains politically contested. Industry bodies have warned against direct intervention in petrol station pricing, and economists debate whether such measures actually keep prices lower over time or simply shift the pain elsewhere.
For anyone filling up in Germany, timing matters. Germany has a fuel price transparency mechanism where each petrol station must report its prices in near real-time, and many apps use that data to help drivers find cheaper options. Prices also tend to be lower on weekday evenings and higher at weekends and public holidays.
It also pays to exit the Autobahn to refuel, motorway service stations consistently charge a significant premium over regular filling stations.
The structural reasons why Germany sits near the top of Europe's fuel price league are unlikely to disappear anytime soon. The carbon levy, energy tax and VAT are all baked into the system by design. What may change, depending on how the government's task force plays out, is whether price rises can at least be made to move a little more slowly.
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