The sharp rise in fuel prices is emerging as one of people's primary concerns about the Iran-Middle East conflict. The Federal Government has therefore launched a fuel price package to combat the increased price hikes at the pumps. 

The package contains three key measures: a new law to adjust fuel prices and two amendments to the GWB (Germany's Act against Restraints of Competition) to make it easier to take action against abusive fuel price increases.

The coalition parties want to submit the package to the Bundestag immediately, with the aim of introducing the new regulations before Easter, if possible.

From when will filling stations no longer be allowed to increase their prices for petrol and diesel multiple times a day?

Petrol stations in Germany will soon be allowed to increase their fuel prices only once a day, namely at 12:00 noon, while price reductions will be permitted at any time. The Federal Government is thus drawing on the model introduced in Austria 15 years ago, passing a new law on adjusting fuel prices that ensures reliability and greater transparency in prices at the pump. 

The price of petrol currently changes up to 22 times a day, which equates to a huge lack of transparency for motorists and commuters. Violations of the ban on daily multiple price increases could result in fines of up to 100,000 euros.

The ban is intended to break the “rocket and feather effect” observed by the Federal Cartel Office, whereby fuel prices often rose very quickly in the past when crude oil prices rose, but only fell slowly when the oil prices dropped. The Federal Government intends to review the effectiveness and impact of the measures in practice after six months.

Will stronger action be taken against abusive price increases in future?

Yes, the Federal Government wants to tighten the monitoring of abuse under competition law in the fuel sector. In future, the Federal Cartel Office will find it easier to take action against market-dominant or powerful companies in the fuel sector if there are indications of unreasonably high prices. In particular, this should also prevent excessive prices compared to independent petrol stations. 

If there is any suspicion that fuel prices are being abusively inflated, the companies must then demonstrate that the increases are justified. Tighter controls on costs and prices are a prerequisite for price reductions.

In addition, the Federal Cartel Office will be able to identify structural distortions of competition more easily in future and thus remedy them more quickly.

Will there still be enough oil left for Germany when the reserves are released?

As a result of the Iran-Middle East conflict and the closure of the Hormuz shipping route, the oil price on the global market has risen by around 30 percent and in many countries the situation is tense – this applies in particular to Germany's partner countries in Asia, such as Japan and South Korea, which import large quantities of crude oil from the region. Germany sources only a small proportion of its oil imports from the Middle East (see below).

The International Energy Agency (IEA) has therefore asked its member states to release oil reserves totalling 400 million barrels (a good 54 million tonnes). The release is an important signal to the world market that there is enough oil available, with the aim being to ease the current market situation and thus dampen the global price increase.

Germany is prepared to show solidarity by contributing to this and releasing part of its reserve. The country's emergency reserve for approximately 90 days comprises a total of around 19.5 million tonnes of crude oil and oil products. Only 2.6 million tonnes are to be released, although this doesn't necessarily mean they will actually need to be drawn on. In any case, the supply of diesel, petrol and heating oil in Germany remains secure. 

Where do the fuels used in Germany come from?

Germany obtains only around six percent of its crude oil from the Middle East, importing most of its supplies from Norway, the USA, Libya, Kazakhstan and the United Kingdom. Mineral oil products – such as petrol and diesel – are mainly produced in Germany from imported crude oil, with imports coming mainly from the Netherlands, the USA, Norway and Belgium.