Germany’s Federal Economy Minister Katherina Reiche is proposing restrictions on the fuel price cap agreed by the governing coalition. According to information from the Economy Ministry, the draft law would establish “objective conditions” for using the measure.
The cap could be introduced if fuel prices remained significantly above the European average for three consecutive weeks. Its application would be limited to a maximum of three months and could be suspended if fuel supply security were at risk.
The ministry said the proposal was intended to provide an effective instrument for exceptional, crisis-related fuel price increases while ensuring that petrol and diesel supplies remained available to households and businesses. The draft is currently in the early coordination stage within the federal government.
The coalition leadership agreed in September to negotiate with the mineral oil industry with the aim of introducing a fuel price cap by 1 January 2027 at the latest. The measure is intended to be temporary and linked to a crisis. The agreement followed fuel price increases associated with the conflict involving Iran, while an existing fuel discount is due to expire at the end of December.
The ministry warned that setting maximum prices too low could make fuel deliveries unprofitable, discourage imports and cause supply shortages. The planned rules would therefore seek to ensure that deliveries remain economically viable even under a state-imposed cap.
The proposal would also allow Germany’s states to set different maximum prices. The ministry said procurement and transport costs, market conditions and competition varied considerably across the country, meaning a uniform national limit could have different effects from one region to another.
Sources: Handelsblatt.