Leonard Gregor

This paper evaluates the temporary reduction in energy taxes implemented by the German government between June and September 2022. We use pricing and quantity data from the wholesale market for crude oil, gasoline, and diesel and find an average pass through of 80% to 85% of the tax cut, which amounts to a 3.7 cents per liter increase in wholesale prices net of tax. We do, however, document significant treatment heterogeneity over time and across regions within Germany. When weighting price effects by quantities sold, the estimated pass-through of the tax cut decreases to about 70% for gasoline and 58% for diesel, suggesting that refinery margins increased significantly during times of higher demand. 

This paper evaluates the effect of the Russian invasion of Ukraine in February 2022 on refinery margins, i.e. the difference between wholesale prices for road fuels (gasoline and diesel) and oil prices in Europe and Germany in particular. Following the Russian invasion of Ukraine, wholesale road fuel prices net of taxes rose by more than 50 cents per liter, whereas crude oil prices increased by only about 30 cents per liter. Using a difference-in-differences framework, we compare refinery margins in Germany with those on the Amsterdam–Rotterdam–Antwerp (ARA) spot market, which serves as a European benchmark price. The results indicate that refinery margins in Germany increased by approximately 5–6 cents per liter relative to the ARA region after the invasion. We attribute this differential primarily to Germany’s strong dependence on Russian Ural crude oil imports and to the presence of regional market power among German refineries. We further document substantial heterogeneity in treatment effects across both time and regions. In addition, the invasion was associated with a significant decline in fuel demand, with gasoline consumption falling by about 13% and diesel consumption by approximately 9%. 

Following the 2026 energy crisis triggered by the Iran War, Germany implemented a regulatory reform in the retail fuel market that fundamentally altered the timing of price adjustments. Effective 1 April 2026, the Kraftstoffanpassungsgesetz (KPAnG) permits petrol stations to increase prices only once per day, at noon, while allowing unrestricted price decreases. This paper provides the first empirical evaluation of the reform. The results indicate an increase in average gasoline retail margins of 5–6 cents per liter (c/l) and no significant effect on diesel margins. We define retail margins as the difference between retail prices net of taxes and fees and Amsterdam–Rotterdam–Antwerp (ARA) wholesale prices. The policy reduces intraday pricing cycles from eight to one, thereby simplifying consumer search. Additionally, the analysis reveals heterogeneous effects across regions, brand size, and time of day. We conclude that the reform was successful in increasing price transparency but failed to reduce price levels; if anything, it had the opposite effect.