Gas Station Owner: "To Lower Fuel Prices, You Must Address Taxes"

Fuel prices have soared following recent geopolitical events. To understand the impact on the ground, we spoke with an independent gas station operator in Münster, who preferred to remain anonymous. Her family has owned the station since 1937, offering a unique perspective on the challenges and changes in the industry.

Your family has operated a gas station since 1937. Have you ever experienced fuel prices as high as today's?

Prices were similarly high after the outbreak of the war in Ukraine, and customers were certainly grumbling then. However, fuel prices are always a constant topic at the gas station, regardless of how high they are. Things used to be very different: our station didn't even have a telephone, and on Mondays, we'd receive a postcard from the oil company telling us how to change prices by Wednesday. We literally had to climb a ladder and adjust the price displays by hand.

Back then, prices were only adjusted once a week.

Digitalization changed that. In 1991, when my husband and I took over the station, we automated the processes. Prices were then automatically controlled by the oil company's system, under whose lease we were at the time. In 2002, our station was sold as part of a merger. Later, in 2007, we terminated the contract with the lessee and have operated the station as an independent entity ever since.

How do you differ from large chains, and how do you determine your prices?

Independent gas stations primarily differ in that they purchase their fuel directly from wholesale oil suppliers and are not bound by the structures of large corporations. This gives us more flexibility, but it also means we must react more strongly to the market. An automated pricing system continuously evaluates the prices of surrounding gas stations, as well as data from the market transparency office, and adjusts our prices accordingly. For example, I can specifically set our price one cent below a branded gas station located within about 500 meters. This allows us to remain competitive and react quickly to changes.

Practically speaking, what are the current prices for gasoline and diesel at your station?

Diesel is currently at 2.279 Euros, and Super E5 gasoline is at 2.099 Euros.

Prices are high everywhere in Germany right now. How are your customers reacting?

Many customers are annoyed and complain to us. We also have a particular situation at the moment: there has been a construction site directly at the gas station for about four weeks. Our sales have dropped by about 30 percent since then. It's hard to say exactly how much of that is due to the high fuel prices. However, I have the impression that private customers are filling up less frequently or with smaller amounts.

The high costs are a significant burden for the population.

We observed that on the autobahn yesterday: many cars were traveling noticeably slower, often only about 100 km/h. You notice that people are driving consciously to save fuel. Generally, many people are currently thinking about where they can reduce costs in everyday life, and driving behavior is an example of that.

Germany recently decided that fuel prices can only be increased once a day. What do you think of this?

The fuel price will not change because of this. This regulation is complete nonsense and achieves nothing. If a gas station is only allowed to increase prices once a day, for example at 12 p.m., then it will simply set a higher initial price to be on the safe side. After that, automatic systems will continue to adjust prices to the competition as before. This could even lead to the average price over the day being higher than before. Because if gas stations fear not being able to increase prices later, they will set the price higher as a precaution. For consumers, refueling will not become cheaper; in the worst case, it might even become slightly more expensive.

Is there another solution that would truly lower prices?

Yes. If you really want to lower fuel prices, you would have to address taxes. A large part of the fuel price consists of taxes and duties, such as energy tax, VAT, and the CO₂ levy. Together, these make up a significant proportion of the price per liter. If the state were to reduce these taxes, the price at the gas station would drop directly. Other measures like price regulations or fuel price caps may sound politically good, but they often change little about the actual price and are practically unfeasible.

Will the situation in the oil market calm down again?

That depends primarily on the geopolitical situation, especially the conflict in the Middle East. Such crises have very rapid effects on the oil price. Another factor is how the large oil companies and producing countries behave and whether they exploit the situation.

What do you mean by that?

The oil price is traded on international exchanges, and there, prices react very sensitively to political tensions. As soon as uncertainty arises somewhere, the price often rises immediately – even if the purchase price at the refineries isn't that high yet. You can compare it a bit to interest rates: when the ECB changes key interest rates, banks don't immediately pass them on one-to-one to customers. It's similar with oil companies: they profit from higher prices and fill their coffers. Anyone with market dominance would do that. I don't know exactly how prices are determined in detail. My wholesale oil suppliers buy from the refineries themselves, and I only buy from them. Russian oil tankers don't come by my station.

Do you, as an independent gas station, receive support from the federal government?

No, not at all. On the contrary: additional levies are even planned, for example in connection with the CO₂ tax, which also affects gas stations. This means more costs for us instead of support. Ultimately, we are just normal, independent entrepreneurs and have to figure out ourselves how to make ends meet economically. While there is an Association of Independent Gas Station Operators, of which we are a member, it cannot directly support us financially. The association primarily represents our interests to politicians and the public.

Is the business profitable?

That's always relative. You certainly won't get rich with an independent, small gas station; ours, for example, is too small for that. You can make a living from it, but you shouldn't expect huge profits. It's different for large gas stations in good locations, for example on highways or busy roads. There, you can earn a lot of money.