Fuel prices fell sharply across much of Germany on Thursday as the country’s second fuel tax cut of the year came into force at midnight, aimed at easing the burden on motorists after energy costs skyrocketed following the start of the Iran war.
The three-month reduction in energy taxes is intended to lower the price of petrol and diesel by 16.7 cents (18.9 US cents) per litre.
Long queues formed at some petrol stations as the average price for E10 petrol dropped to €2.052 per litre by 11:45 am, compared to €2.242 on Wednesday, according to the ADAC motoring association.
Diesel prices declined to €2.197 per litre on average, down from €2.390 on Wednesday.
In many areas, the cheaper E10 grade of petrol was being offered for less than €2 per litre, according to ADAC data, although there were significant regional differences.
The government introduced the measure in response to exceptionally high fuel prices driven by the conflict with Iran.
September was by far the most expensive month on record for filling up in Germany, with fuel costs also contributing to inflation.
How much of the tax cut will ultimately be passed on to motorists is expected to become clearer over the coming days, as petrol stations are not directly required to lower their prices.
The measure technically applies only to fuel leaving storage facilities or refineries. Fuel prices had already fallen on Tuesday and Wednesday.
A previous fuel tax cut this year also led to a sharp drop in prices shortly after taking effect, although there was debate over how much of the reduction was ultimately passed on to consumers.
The fuels and energy industry association en2x said the tax reduction would be passed on from midnight. The ADAC had been more cautious ahead of the measure taking effect.
“Prices will gradually come down,” fuel market expert Christian Laberer said.
“We are calling for the reduction to be passed on in full and as quickly as possible, but there is concern that part of the tax cut will not reach motorists.”
The measure has been criticized for being poorly targeted, reducing incentives to save fuel and potentially not being passed on in full to consumers. The fuel industry disputes the latter criticism.
Supporters argue there is currently no better way to provide relief to motorists.
dpa
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