The Merz government's tax grab is hitting hard: Gas prices are rising faster than in EU neighbors
The Merz government's fuel tax grab is backfiring, with gas prices rising faster in Germany than in neighboring EU countries. Experts are disappointed, and the government's new fuel rule is proving ineffective.
In recent weeks, the rising fuel prices in Germany have left many drivers scratching their heads. What was once a given - affordable fuel for daily commutes, shopping trips, and family vacations - has become a costly consideration for many. A new government rule was supposed to help, but the hoped-for turnaround has not materialized.
The oil price crash following the ceasefire between the USA and Iran on April 8, 2026, brought temporary relief at German gas stations. According to ADAC data, the nationwide average price for a liter of Super E10 gasoline fell by 3.3 cents to 2.155 euros on Wednesday. Diesel prices dropped by 2.8 cents to 2.419 euros, marking the first decline after twelve consecutive increases, according to the ADAC. However, this short-term drop is misleading. Overall, fuel in Germany is currently 38 cents more expensive for E10 and 67 cents more expensive for diesel than before the Iran war began. And the government's measures to relieve citizens at the pump have not shown any significant impact, according to experts.
The 'Rocket and Feather Effect': Prices Rise Fast, Fall Slowly
The fact that the drop at the pump is much smaller than the crash on the oil market is no coincidence. The price of a barrel of North Sea Brent crude oil fell by up to 16 percent after the ceasefire and the opening of the Strait of Hormuz, dropping to 91.70 US dollars. However, only a fraction of this drop has been reflected at the pump.
The Federal Cartel Office explicitly notes in its current fuel report that falling crude oil and wholesale prices during the Iran war have only recently arrived at the pumps with significant delays. This phenomenon is known as the 'Rocket and Feather Effect' - a term used by the German government itself. Prices rise quickly like a rocket and fall slowly like a feather. Moreover, the oil price has already risen slightly in the morning, reducing the scope for further reductions. The ADAC calls for consequences: 'Given the significantly fallen oil price yesterday, the decline in fuel prices is more than justified. If oil prices remain low, this price reduction must continue.'
The 12 o'clock rule: Well-intentioned, but ineffective
Since April 1, 2026, a new rule has been in effect at German gas stations: price increases are only allowed once a day - at 12 o'clock noon. Price reductions, on the other hand, are possible at any time. The rule is based on the Austrian model and was intended to protect consumers from arbitrary price spikes. However, the balance after the first week is sobering. According to ADAC figures, Super gasoline was almost nine cents more expensive, and diesel was almost 13 cents more expensive a week after the rule was introduced. The ADAC recorded average price jumps of more than ten cents at noon. Ramona Pop, Managing Director of the Federal Association of Consumer Centers, sums it up clearly: 'The new fuel rule has proven to be a disappointment.'
ADAC fuel market expert Christian Laberer is even more critical: 'The Austrian model with one price increase per day does not work. The reality is proving the fuel price brake to be a lie.' The concern that oil companies would react with significant risk premiums to the restricted flexibility has been confirmed, according to Laberer.
Gas prices in Germany are rising faster than in EU neighbors
Data from the EU Commission, evaluated by the dpa, provides particularly interesting insights. According to this, the gasoline price in Germany rose significantly faster in the period from the last to the current Monday than in neighboring EU countries. The comparison period also includes several days when the new 12 o'clock rule was already in effect.
Critics of the rule had feared exactly this: that it could drive up prices rather than lower them. While a direct causal link cannot be conclusively proven from the data - and diesel prices showed no clear anomalies according to dpa - the overall picture is alarming. Germany is becoming an outlier within the EU when it comes to gasoline prices.
What Europe is doing - and what Germany is not
While Germany is waiting for the impact of its new fuel rule, many European neighbors have already taken concrete measures. Austria and Italy have reduced the mineral oil tax to directly relieve consumers at the pump. Spain is planning a significant reduction in taxes on gasoline and electricity. Poland has introduced tax adjustments to counteract fuel tourism. Hungary and Slovakia are focusing on price brakes and state regulations. Belgium and Luxembourg go even further, setting maximum prices for fuels. In Belgium, the Ministry of Economics even calculates the maximum allowed prices for gasoline and diesel on each working day based on various factors.
The Cartel Office remains in an observer role - despite expanded powers
Regulatory authorities are also under criticism. ADAC President of Technology and Traffic, Karsten Schulze, calls for action: 'The government has given the Federal Cartel Office higher powers. It is not understandable that these are not being utilized and that the authorities remain in an observer role.' The oil industry, on the other hand, points to external factors. A spokesman for the Fuel and Energy Association explained: 'The cause of the price development is still the Iran war, which has led to a significant disruption of the global supply of petroleum and petroleum products.' He continued, 'The pump prices follow the procurement costs at the international markets for gasoline and diesel.' While this explanation is factually correct, it does not answer the question of why the price increase is stronger in Germany than in neighboring countries.
According to the EIA forecast, oil prices are likely to remain above pre-crisis levels due to ongoing uncertainties about future supply disruptions until the end of the year - and fuel prices could continue to rise for months even after the Strait of Hormuz reopens. Since the start of the war, diesel has already increased by around 70 cents in Germany, and E10 by more than 40 cents, according to the Federal Cartel Office's fuel report.
