According to the Competition Commission, the planned fuel price cap could inadvertently backfire. Tomaso Duso, head of the Competition Commission, warned in the “Süddeutsche Zeitung” that “in practice, a cap often becomes the target price, to which even cheaper gas stations orient themselves.” This creates a fundamental dilemma: if the cap is set generously, it will have no impact. However, if it is set too tightly, it risks jeopardizing supply because providers would be forced to sell below cost and would divert shipments to neighboring countries, Duso cautioned.
The federal government included the prospect of “a fuel price cap modeled after Luxembourg or Belgium” as part of its relief package from last Friday. This cap is intended to be in place by the end of the year and to cover at least the period of the energy crisis, with the federal government planning regular discussions with the oil industry to set maximum prices for gasoline and diesel.
However, Duso also warned that there is a risk of industry agreements inherent in this approach. For instance, the Belgian maximum price has been based on a contract between the government and the oil association since 1974. Investigations have shown that some gas stations use the maximum price to coordinate among themselves, rather than it truly restricting them. “In a concentrated market, this is precisely what is wrong from a competitive perspective,” Duso stated.
