Escalating Israel-Iran Tensions Impact Fuel Prices

The ongoing conflict between Israel and Iran is having a significant effect on global fuel prices, particularly in Europe. Following Israel's military actions against Iran, the prices of crude oil have surged, leading to higher costs for gasoline and heating oil across the continent.

As of Sunday morning, the average price for a liter of Super E10 gasoline in Germany reached EUR1.749, with diesel priced at EUR1.639. These figures reflect a slight increase from the previous day, where prices were marginally lower. Although these specific times were associated with peak pricing at gas stations, average daily prices indicate a consistent upward trend.

According to recent data from the ADAC, Saturday's average prices for Super E10 and diesel were recorded at EUR1.671 and EUR1.551 per liter, respectively, marking an increase of approximately 1.3 cents from Friday. The average price for Sunday will be available on Monday.

Despite the current price hikes, the Mineral Oil Industry Association (MWV) emphasizes that prices remain relatively low compared to previous highs this year. For instance, diesel reached a peak of EUR1.70 in January, while Super E10 hit EUR1.76 in February, indicating that current prices are still below these levels.

The ADAC warns that while the price increase is moderate, the trend is clear, suggesting further increases may be on the horizon. However, they also caution against overreacting, stressing the importance of not providing fuel companies with justification to raise prices excessively.

In addition to gasoline, heating oil prices have also seen a notable rise in Germany since the onset of hostilities. A recent study from the comparison portal Verivox indicates that the price for 100 liters of heating oil is currently around EUR93, up from an average of EUR87 in May, which was the lowest recorded price in two years.

Experts suggest that filling up heating oil tanks now could still be a wise decision despite the recent price increases, as long-term comparisons show that current rates are still competitive. The analysis indicates that geopolitical uncertainties and rising CO2 costs could further elevate prices in the coming year.

The recorded average price of EUR87 for 100 liters of heating oil in May suggests annual heating expenses of approximately EUR1,739 for an average household consuming 2,000 liters per year. This is significantly lower than the peak price of EUR119 for 100 liters noted in September 2023, reflecting a decrease of about 27% since then.

While the current heating oil price of EUR93 remains relatively low in a historical context--compared to averages of EUR99 in 2024, EUR104 in 2023, and EUR131 in 2022--market dynamics are influenced by various factors. Earlier in May, oil-producing countries had agreed to increase production, which initially caused a decrease in crude oil prices. However, recent geopolitical tensions and protectionist trade policies from the United States, along with fears of a global recession, have added to market volatility.

In summary, the conflict between Israel and Iran is reshaping energy markets, causing fluctuations in fuel prices that consumers are likely to continue feeling in the near future.