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DRIVING

German drivers face higher fuel costs than neighbouring countries

Prices for petrol and diesel in Germany have risen above those of neighbouring countries since the end of the fuel tax reduction.

The price of premium gasoline and diesel is displayed on September 1st in Munich.
The price of premium gasoline and diesel is displayed on September 1st in Munich. Photo: picture alliance/dpa | Felix Hörhager

The cost of fuel in Germany has risen significantly and is now higher than in all directly neighbouring EU countries, according to the Federal Statistical Office.

According to the report, the price differences compared with other countries amount to an average of up to 69 cents per litre.

In the three months of the fuel discount from June to August, however, fuel prices in Germany had been at or slightly below the price level of neighbouring countries.

From June 1st until the end of August, energy taxes on fuel in Germany were reduced to the EU minimums, as the traffic light coalition government cut the duty on fuel by about 35 cents per litre for petrol and about 17 cents for diesel.

But on September 1st the prices shot back up again.

READ ALSO: Everything that changes in Germany in September 2022

The main reason for the high fuel prices in Germany is the Russian war in Ukraine and the resulting rise in crude oil prices. Prior to the war, Germany had sourced around a third of its oil from the country.

How do fuel prices in Germany compare to other countries?

According to official statistics, motorists in Germany paid an average of €2.07 for a litre of Super E5 petrol and €2.16 for a litre of diesel last Monday. In Denmark, prices were similar at €2.04 for Super E5 and €2.07 for diesel, while in the Netherlands, the second most expensive neighbouring country, they were six and 11 cents below the German average, respectively.

In other neighbouring countries, fuel was significantly cheaper. In Poland, Super E5 petrol cost an average of €1.38 per litre last Monday, and diesel €1.61. In France, the Czech Republic and Luxembourg, too, the average price was at least 30 cents less per litre than in Germany. In Belgium, Super E5 cost €1.69 per litre, diesel €2.02; in Austria, it was €1.74 for Super E5 and €1.90 for diesel.

Social policy expert with the Left Party in the Bundestag, Sören Pellmann, told the Neue Osnabrücker Zeitung that the high fuel prices in Germany were a “result of policy failures of the traffic light coalition”.

READ ALSO: German petrol costs rise sharply after tax cut ends

Pellmann pointed out that mineral oil companies would rake in almost €40 billion in additional profits this year, and demanded that the federal government “skim off this money and permanently stop the self-enrichment at the expense of commuters”.

In France, he said, fuel prices were around 40 cents lower. “That’s the benchmark for the federal government,” he said. 

Bavarian state premier Markus Söder has also spoken out in favour of lowering fuel taxes again.

“It would be a real relief for people in rural areas if the fuel rebate were extended,” the CSU leader told the Neue Osnabrücker Zeitung.

“It is no longer just about helping low-income earners, but also to prevent normal earners from becoming low-income earners,” Söder said.

READ ALSO: Fuel in Switzerland: Why Germans are crossing the border to fill up

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ENERGY

REVEALED: Germany’s planned hardship fund to help with energy bills

The gas and electricity price caps are coming, and the government wants to pay people's energy bills in December - but will that be enough to stop people falling into hardship? Germany's Economics Ministry thinks it won't be and has drafted plans for a new hardship fund. Here's what you need to know.

REVEALED: Germany's planned hardship fund to help with energy bills

When Germany’s traffic light coalition parties – the SPD, Greens and FDP – took office last December, they had no idea that they would be facing an energy crisis on such a major scale.

But with Russia’s invasion of Ukraine sending the gas market into turmoil, the coalition’s big plans have been put on the backburner as they work out how best to support people with rising costs. 

Under the latest set of energy relief measures put forward by the Gas Price Commission, the government will shoulder the cost of people’s energy bills this December. It also plans to introduce a cap on both electricity and gas prices, which will come into force next March and be backdated to January.

READ ALSO: Germany plans to cap energy prices from start of 2023

This multi-billion relief package is likely to soften the blow for many households, but according to a new government document obtained by Bild, ministers are concerned that it won’t be enough to stop many people – and businesses – falling into financial hardship.

To ensure this doesn’t happen, federal and state economists ministers want to set aside billions more for additional aid. 

Here’s who can get hold of the extra cash – and how.

Renters and private home owners

People who rent an apartment in Germany and home owners who live in their properties can access additional help from the state if they can prove they’re over-burdened by their heating and energy costs.

That could be due to an eye-wateringly high back-payment for energy bills demanded by the landlord or due to the fact that they have to purchase expensive fuel such as wood pellets for heating. 

More specifically, people claiming unemployment benefits such as Bürgergeld can get some extra cash from the Jobcenter after their bills are calculated by the landlord. If they’re facing a hefty back-payment, or Nachzahlung, they can get up to three months of Bürgergeld retroactively to help cover the costs. 

In addition, someone who wants to claim Bürgergeld for a single month will be spared from having to prove the amount of money they have in the bank. Under the ordinary rules for Bürgergeld claimants, job seekers must have less than €40,000 in savings.

According to the government’s calculations, this emergency buffer is set to cost around €500 million. Claims for additional support will be handled by the job centres or social offices.

Small- and medium-sized businesses (SMEs)

Small business owners have been among the hardest hit by the energy crisis – but luckily help may be on its way. 

In the document obtained by Bild, ministers say they assume that the gas and electricity price cap will be an adequate level of support for most SMEs. Nevertheless, there could be a few circumstances in which business owners slip through the net:

  • Business owners may already be facing huge hikes in their energy bills before the price caps come into force, for example in the form of a big back-payment for energy costs over several months, or
  • Businesses may find that, due to exceptional circumstances, they’re still unable to pay their bills – even after the price caps are introduced. 

In these two scenarios, SMEs can apply for extra support from the government. 

To be eligible, businesses must either show that their energy costs quadrupled at least three months between January and November 2022, or they’ll have to show that their energy costs have also multiplied in spite of the energy price cap and that their business is highly energy-intensive or costly.

The government expects this support package to cost around €1 billion and says that the details will be worked out after state premiers agree to the proposals.  

READ ALSO: How electricity prices are rising across Germany

Housing companies 

Large landlords could also be in line for some additional government aid under the ministers’ plans. Due to the way the current rental system works, many are paying high bills for heating and energy that they’re not yet able to recoup from tenants in the end-of-year bill.

Housing complexes in Berlin.

Housing complexes in Berlin. Photo: picture alliance/dpa | Monika Skolimowska

To help housing companies that are in this situation, the government wants to offer loans that could help tide them over. Twenty percent of this credit would be secured by the federal states, and the measure is expected to cost around €1.1 billion. 

Hospitals and care homes  

Care facilities and clinics face exorbitant energy bills – even in ordinary times – so this group of institutions will also be given financial aid, the draft said.

This will come in the form of a one-off support payment and ongoing support with gas and electricity bills. Hospitals and care homes will in many cases get their additional costs for energy completely refunded by the state until April 2024. Social agencies and social service providers will also be given subsidies and financial aid to help deal with their increased overheads. 

In addition, cultural sites and facilities like museums and art galleries will get subsidies intended to flatten out the rise in energy costs. In most cases, the energy price cap only applies to 80 percent of a business’ ordinary consumption, but this limit will be dispensed with for cultural institutions. 

However, the government says it still wants to incentive energy-saving measures as well as offering financial support. 

READ ALSO: When will people in Germany get their December gas bill payout?

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