German Economy Minister Katherina Reiche warned Thursday that new relief measures should be approached cautiously as fuel prices spike amid the US-Israeli war with Iran. Global supplies are under pressure because of disruptions around the Strait of Hormuz, attacks on Iranian fuel infrastructure and Tehran’s counterattacks in the Gulf, driving up pump prices.
Fuel costs have risen sharply since late February, just before the conflict escalated. Data from the General German Automobile Club show diesel has climbed by €0.42 per liter and E10 petrol by nearly €0.27 per liter. The pace of increases has recently eased. On Wednesday the nationwide daily averages were €2.044 per liter for unleaded E10 and €2.167 per liter for diesel. Oil jumped again after Qatar reported major damage to a large liquefied natural gas facility following Iranian strikes.
Reiche told the Bundestag that what Germany does not need “20 days after the war” is “activism,” and said the government is acting in a measured way. Options under consideration include a fuel price cap, discounts or a windfall tax, but she said any step must be weighed for its costs and benefits.
The coalition has proposed a fuel-pricing package that limits price increases at filling stations to once daily at noon while allowing reductions at any time, and it tightens antitrust rules. The Bundestag aims to pass the package under an expedited procedure next week, with the Bundesrat expected to consider it the following Friday. Whether the measure will reduce prices is disputed.
Parties differ on further action. SPD deputy floor leader Armand Zorn said the government will “adjust” if the crisis persists and that a windfall tax is being discussed, calling it indecent to profit from war. SPD Finance Minister Lars Klingbeil is reportedly considering a special tax to “skim off excessive crisis profits.” Conservative CDU deputy Sepp Müller warned of further measures if companies drive up prices. Opposition parties, including the Left, accused the government of doing too little; Left leader Ines Schwerdtner said people are being left behind. The Greens support a windfall tax, and the Left also advocates cheaper public transport.
Edited by: Sean Sinico