Competitive pumps
May 31, 2011
German Transport Minister Peter Ramsauer set the ball rolling on Monday, when he told the Bild newspaper of his enthusiasm for the Australian method of ensuring competitive pricing at fuel stations.
"If an oil multinational has to declare a higher price, and then isn't allowed to change it for 24 hours, then the motorist knows what's going on," he said. "The lawmakers have to try to protect consumers from the random price manipulation of oil companies who control the market."
Then on Tuesday the Free Democratic Party, junior partner in Germany's ruling coalition, apparently sealed the deal by echoing the minister's approval. The FDP's transport spokesman Patrick Döring told the Neue Osnabrücker Zeitung that the Australian model was worth analyzing.
"For the FDP, it's all about choices for the consumer and stopping market abuse before bridge days and bank holidays," he added. Döring even suggested that the implementation could move quickly, saying that he expected "the cabinet to work out some proposals before the summer recess."
Other ideas
The FDP, proud of its image as protector of the free market, said the decartelization law proposed by their former Economics Minister Rainer Brüderle would also be an option. This would instigate a new analysis of the entire chain of the oil trade, from the refineries all the way to the filling stations.
The motorist's association Autoclub Europa (ACE), meanwhile, called for the introduction of the Austrian system, which allows filling stations to raise fuel prices only once a day, but lower them as often as it likes. The ACE believes this promotes competition.
Cartel accusations
Germany's oil companies have been under pressure since last week, when the Federal Cartel Office published a report accusing them of keeping a network of price observers throughout the country and adjusting the prices by the day, or even by the hour, depending on what rivals are doing.
The report found that the retail fuel market is an oligopoly comprised of Aral/BP (23.5 percent), Shell (22 percent), Jet (10 percent), Esso and Total (7.5 percent each). The two largest of these were said to act as "signallers" that dictate the market price to the other companies.
Cartel Office spokesman Kay Weidner said last week that "market structures have arisen that are not necessarily beneficial to consumers."
The oil companies responded angrily to the claims, saying that the Cartel Office had tried and failed to find any evidence of actual price-fixing.
"With the assessment that this is an oligopoly controlling the market, the office tries to discredit an entire industry sector by linking it to the legal gray area and tarnishing its reputation," Klaus Picard, head lobbyist of Germany's MWV oil industry association, told a press conference last Monday.
"If the Cartel Office had the guts, it would admit it and say: 'Sorry, we were wrong.'"
Author: Ben Knight (dpa, AP, AFP)
Editor: Sam Edmonds