Diesel in Germany now just 7 cents more than before Iran war

The cost of fuel is falling in Germany, and prices are nearing those seen before the US and Israel’s attacks on Iran. On June 15, the cost of diesel was just 7 cents more than before the war began.

Fuel prices falling in Germany

According to the General German Automobile Club (ADAC), on June 15, the average cost of a litre of diesel fuel in Germany was 1,816 euros. This marked the seventh consecutive day that diesel fuel prices fell. The cost of E10 fuel has also fallen to 1,868 euros per litre.

This means that diesel is now only 7 cents more per litre than before the US-Israeli attacks on Iran, which sparked an international energy crisis. E10 is now only 9 cents more per litre than before the war began.

As of April 1, fuel stations in Germany are only permitted to raise prices once per day, but may reduce prices an unlimited number of times. This has resulted in the so-called “12 o’clock rule”, fuel is typically cheaper in the morning, before prices rise sharply at midday and then fall again throughout the afternoon and evening.

According to a SPIEGEL report, following news of a peace deal between the US and Iran, figures suggest prices will continue to fall in the coming two weeks.

Fuel prices may rise again in two weeks

However, there is also concern that prices will begin to rise again in two weeks. In April, the German government announced it would cut taxes on petrol and diesel by 16,7 cents per litre starting May 1.

Since then, fuel companies have had to pay less in taxes, and the government expected companies to pass these savings on to customers by reducing prices at the pump. According to an initial assessment by the Monopolies Commission, the tax cut was “largely, but not entirely” passed on to customers. 

The German government’s independent advisory body estimates that of the 16,7 cents of tax relief available per litre, fuel companies passed on between 15 and 16 cents to customers. The policy was expected to cost the public purse around 1,6 billion euros. Of the 1,6 billion euros, an estimated 100 to 200 million euros in relief did not reach customers. 

However, this tax cut for fuel companies is due to end on June 30, and the CDU/CSU-SPD government is not expected to extend it. This means that from the end of June, fuel prices could start to rise again.