Germany's fuel discount expires, prices set to rise

Germany's temporary fuel discount, introduced to cushion the impact of sharply rising oil prices, officially ends today, June 30. This expiration means that starting tomorrow, July 1, drivers can expect a noticeable increase in gasoline and diesel prices.

The reason for the impending price hike is the return of the old, higher tax rates. Fuel leaving storage depots or refineries on or after July 1 will be subject to these increased taxes. Including value-added tax, this amounts to an additional 16.7 cents per liter for consumers.

The Federal Association of Tankstellen (bft) has noted that the price adjustment at the pump may not be immediate at midnight. Instead, they anticipate the price increases will become noticeable around noon on July 1, as regulations stipulate that prices can only be raised at 12:00 PM, not at midnight when the tax relief officially concludes.

This fuel discount was initially implemented in response to the surge in oil prices following the conflict in Iran, aiming to provide relief to motorists. The measure, however, came at a significant cost to the federal government, with estimates from the Finance Ministry placing the total expense at around 1.6 billion euros. The exact final cost of this tax relief will become clearer in the coming months.