Second fuel discount 2023: Energy tax cut should reduce fuel prices by 16.7 cents
Quick Look
- A new fuel discount has been in effect since midnight with a reduction in energy taxes of 16.7 cents per liter of gasoline or diesel until December 31st.
- Experts expect it to be passed on quickly to consumers, but warn of deadweight effects.
- September was the most expensive month for fuel so far.
AI-generated summary
Why It Matters
The federal government introduced the fuel discount in response to high fuel prices, which have risen sharply due to disruptions in the oil markets due to the Iran war. September was the most expensive month for fuel so far.
The second fuel discount this year has been in effect since midnight. A reduction in energy taxes valid until December 31st should bring relief of 16.7 cents per liter of gasoline or diesel. How completely it will be passed on to consumers will become clear in the next few hours and days. There is no direct obligation for gas stations to lower prices.
The rule applies to fuel that has left tank farms or refineries after midnight. Experts expect prices at most gas stations to fall significantly from midnight onwards. This was also the case with the two previous fuel discounts in May and June and in 2022. In addition, fuel had already become cheaper on Tuesday and Wednesday.
“Prices will gradually decline,” said fuel market expert Christian Laberer from ADAC in advance. "We are calling for it to be passed on completely and as quickly as possible, but there is a fear that there will be deadweight effects, meaning that the tax discount will not fully reach the driver."
September was by far the most expensive month for fuel
The federal government launched the fuel discount in response to the high fuel prices, which have skyrocketed due to the turmoil in the oil markets due to the Iran war. September was by far the most expensive month to refuel so far. The measure is estimated to cost 2.5 billion euros.
The fuel discount is controversial; critics point out, among other things, that it is inaccurate, dampens the incentive to save fuel and does not fully reach consumers. The petroleum industry contradicts the latter. Proponents point out, among other things, that there is currently no better way to relieve the burden on drivers.
What to Watch
AI outlook — possibilities, not facts
Prices will drop significantly at most gas stations from midnight onwards.
Likely · Within hours
It is feared that there will be deadweight effects and that the tax discount will not fully reach the driver.
Possible · Within days
Open Questions
- How fully is the tax rebate passed on to consumers?
- Will gas stations actually lower prices even though they are not required to?
- How long will the effect of the discount last?
