Germany's 12-hour fuel price rule boosts oil industry profits

Germany's new fuel pricing rule sends gasoline profits soaring in weeks

Germany's 12-Hour Rule for Fuel Price Hikes Boosted Oil Industry Profits, Study Finds

A new study suggests that Germany's 12-hour rule for gasoline station price increases has handed the oil industry additional profits. In the first two weeks after the regulation took effect, the profit margin on premium unleaded gasoline (Superbenzin) averaged 6 cents per liter higher than in the two weeks prior. For diesel, however, researchers from the ZEW Mannheim (Leibniz Centre for European Economic Research) and the Düsseldorf Institute for Competition Economics (DICE) found no clear effect.

"The policy package has so far failed to lower price levels. In fact, profit margins for gasoline rose significantly," said study author Leona Jung of DICE. Diesel margins fluctuated widely during the observation period, noted co-author Jacob Schildknecht of ZEW, making it difficult to reliably quantify any increase. "Still, there are indications that diesel may also have been affected," he added.

The impact varied by region and station size. The sharpest margin increases were recorded at smaller chains and independent operators, while large chains saw the smallest rises.

"This disparity shows that the reform's effects are uneven, heavily dependent on market structure and competitive intensity," explained Justus Haucap, director of DICE. "The findings suggest that major companies—dominant players in the market—may be restraining margin hikes out of fear of antitrust scrutiny."

Southern Germany experienced the most pronounced effects. Researchers speculated that the region's higher average income could drive greater willingness to pay, enabling larger margin adjustments. However, they also noted that regional differences in supply chains and crude oil procurement might contribute to cost variations, further amplifying disparities in price responses.

The study analyzed pricing data from Germany's Market Transparency Office for Fuels, comparing the 14 days before and after the reform, which took effect on April 1. To calculate profit margins, researchers contrasted net retail prices with wholesale prices from the Amsterdam-Rotterdam-Antwerp (ARA) trading hub.

Even before the 12-hour rule was introduced—adopted from an Austrian model—critics warned it could push fuel prices higher by encouraging preemptive increases. Early comparisons with EU neighbors also showed that German gasoline prices surged more sharply in the days following implementation.