Fuel prices in Germany rose amid the deepening crisis in the Middle East and risks to oil supplies. The price of Super E10 gasoline, the country’s most widely used fuel, climbed to an average of 2.273 euros per liter on Sunday, setting a record.
The price of Super E10 increased by 1.7 cents from Friday, while diesel rose by 3.5 cents over the weekend to reach 2.404 euros per liter. Both types of fuel have seen significant price increases over the past two weeks.
Developments in the Middle East affect oil markets
The crisis in the Middle East, accompanied by reciprocal retaliation, caused crude oil prices to start the new week higher. A foreign ministers’ meeting planned in Oman to resolve the Strait of Hormuz crisis between the Gulf states and Iran was postponed at the last minute.
Saudi Arabia’s East-West oil pipeline was also temporarily shut down following drone attacks. After the development put 4 percent of global oil supplies at risk, the price of Brent crude approached $108 per barrel.
Domestic factors also contributed to the price increase in Germany. Record-low water levels in the Rhine disrupted tanker shipping and drove up transport costs.
Prices rose from August 30 levels
Compared with levels on August 30, the price of Super E10 gasoline was approximately 12 cents higher per liter, while diesel was approximately 20 cents higher.
The increase raised expectations of new financial support or tax cuts for drivers. However, the German government announced that no new fuel discount was planned.
The previously implemented fuel discount provided relief of 16.7 cents per liter and cost the public budget approximately 1.6 billion euros. The government is not inclined to introduce a new tax cut as it faces a budget deficit due to broad investment and defense packages financed through borrowing.
Germany’s August inflation also rose to 2.9 percent amid higher energy and raw material prices.
