Ifo Institute: Oil companies have so far only partially passed on fuel discounts

Berlin. According to the Ifo Institute, the federal government's new fuel discount, which has been in effect since October 1st, has so far only partially reached the pumps. For diesel, gas stations passed on an average of 15 cents of the 17 cent tax cut per liter in the first five days, as the Munich researchers announced on Wednesday.

For premium petrol E5 it was an average of 16 cents and for super E10 it was 15 cents. “On the first of October, the discount was passed on in full, while the pass-on over the weekend remained incomplete,” said the deputy head of the Ifo Center for Financial Science, Florian Neumeier.

In view of the current shortage of supply, the researchers criticize this measure as not helping to reduce the consumption of diesel and petrol. “The fuel discount is also not very targeted,” said Ifo expert Christian Gréus. “Households with low incomes, small cars and low mileage hardly benefit from this relief package.”

Neumeier emphasized that consumption should be restricted instead. A higher price offers an incentive for this. The discount also distorts purchasing decisions: anyone who buys a gasoline engine becomes dependent on the Gulf region. The price should also show that.

The high fuel prices and government subsidies are causing car buyers in Germany to increasingly turn to electric vehicles. In September alone, 88,599 electric cars were newly registered, almost twice as many as in the previous year, according to the Federal Motor Transport Authority. The vehicles' market share rose to 34.5 percent and was therefore only just below the market share of hybrid cars. Diesel vehicles and petrol engines, on the other hand, fell sharply.

The government-subsidized relief is valid until the end of December. It is intended to reduce fuel prices, which have recently risen sharply in the wake of the war in the Middle East, by almost 17 cents per liter of diesel and gasoline. The controversial fuel discount will cost around 2.5 billion euros, half of which will be borne by the federal and state governments. 14 cents per liter are due to the reduction in energy tax, which means that another three cents are eliminated from the VAT. There was already a fuel discount in May and June.

Record high fuel prices pushed inflation to its highest level in almost three years in September. Goods and services rose by 3.3 percent compared to the same month last year, after 2.9 percent in August. Economists expect the fuel discount to dampen inflation somewhat.