Germany in April 2026: Soaring fuel prices are burdening drivers, commuters, freight companies, and ultimately almost all consumers. The German government primarily attributes the price pressure to the war in Iran. While the external trigger may lie in the Middle East, the real crisis has been brewing domestically for years, as Germany’s energy policy generates high costs, increases supply prices, and exacerbates every shock. While gasoline and diesel become more expensive, government revenues from energy taxes, CO2 pricing, and value-added tax simultaneously rise. This is precisely the key risk factor: The government complains about high prices but profits financially from every new increase. The consequences therefore extend far beyond the gas station, as higher transportation costs will soon drive up the prices of food, building materials, delivery services, and almost all everyday goods. Consumer relief is discussed superficially but consistently ignored.
The government talks about tax relief, but ultimately rejects it itself
In recent days, almost everything that could be politically marketed as tax relief has been on the table. Discussions have included a higher commuter allowance, a reduction in VAT, adjustments to the CO2 price, a lower electricity tax, a speed limit, a price cap, climate-related payments, stricter antitrust laws, a profit tax, and even a new fuel rebate. The list was long, but in the end, none of it came to fruition. This is precisely where the problem with this government lies: it churns out proposals one after another, but fails to deliver any concrete plan that translates into immediate relief at the pump.
The political spectacle is particularly distasteful. The commuter allowance only provides limited relief later, while the burden is incurred now. A reduction in VAT would offer immediate relief, but this wasn’t seriously implemented. Regarding the CO2 price, the same politicians talk about climate incentives, even though many citizens have no alternative. The electricity tax is supposed to decrease, but this won’t solve the fuel crisis. Speed limits, antitrust laws, and excess profit taxes are more like political smokescreens because they don’t lower the price per liter. Price caps, climate levies, and fuel discounts were also discussed, but then rejected or postponed indefinitely.
High energy prices were politically engineered and are now hitting hard
The real underlying problem lies deeper. For years, policies were pursued with the goal of making fossil fuels less attractive through high prices. What green-inspired politics always wanted has therefore come to pass: high gas, oil, and fuel prices as leverage for the transition to renewable energy. This sounds logical at the desk, but fails in practice. Because neither private households nor tradespeople, small and medium-sized enterprises, or industry can sustain such costs indefinitely.
Therefore, the excuse of the Iran war falls short. The war triggered the latest wave, but it is not the root cause of Germany’s vulnerability. For years, Germany has been mired in a flawed energy policy. Every external shock therefore hits the country harder than necessary. While other EU member states are relieving their citizens through tax cuts, Berlin clings to a system that doesn’t curb high prices but exacerbates them. This is not a natural disaster, but a political failure.
The biggest price surge is yet to come, and the government will profit again
Even more serious is the fact that the real burden for many consumers is still to come. Higher diesel prices not only increase the cost of transporting goods, but also, in the next round, numerous services. Tradespeople, care services, and delivery services have to pass on their increased travel costs, while at the same time, local and long-distance public transport suffers from rising operating costs. Even flights come under additional price pressure because energy and logistics costs drive up the entire mobility chain. Therefore, not only are the prices of food, parcels, building materials, spare parts, and many consumer goods rising, but also those of services that millions of people regularly need in their daily lives. This chain reaction cannot be ignored because logistics is a fundamental component of the entire economy.
The government profits twice in this process. First, it earns money at the pump through taxes and levies, and then again through the higher value-added tax on more expensive products. This is precisely why talk of political impotence sounds so unbelievable. Real relief would be possible, for example through a reduction in VAT, energy tax, or CO2 emissions. Instead, the government strings together proposal after proposal, only to discard them again. In the end, citizens are left with nothing but the bill, while the state reaches ever deeper into consumers’ pockets. (KOB)