Super prices
May 23, 2011
Five large service station chains dictate fuel prices to drivers in Germany, and these prices, which should be based on criteria such as oil costs, are often higher than they need to be. That's the key finding of a report to be released on Thursday by Germany's federal cartel office, the Bundeskartellamt.
Officials studied prices at 100 filling stations in Hamburg, Cologne, Leipzig and Munich from January 2007 to June 2010. They found 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).
Combined, these five companies control nearly 70 percent of gas pumps in Germany, with independent service station operators fighting over the rest.
Regulators are particularly concerned about the way major chains track prices at competing outlets and how they respond to those changes.
"Politicians often complain about the high price of fuel and the need to apply cartel laws," Bundeskartellamt spokesman Kay Weidner told Deutsche Welle. "But this is not about oil executives meeting at golf clubs and fixing prices; it's about market structures that have arisen and that are not necessarily beneficial to consumers."
Weidner added that report will make suggestions on how these structures could be altered to ensure competitively low prices. He declined, however, to provide details ahead of its release.
Advanced pricing system
Critics of the major fuel chains say monitoring activities put upward pressure on fuel prices, which reached record levels at the end of last month when the price of super gasoline reached a record 1.62 euros per liter ($8.58 per US gallon).
"The oil companies like to play ball together," said Björn Dosch, a spokesman for the German automobile club ADAC, adding that when one company decides to take the lead and raise prices, the others like to follow - because they can.
"They have advanced computerized pricing systems that allow them to change prices very quickly," Dosch told Deutsche Welle. "This wasn't possible years ago when gas station attendants had to pull out a ladder and physically change the numbers on their signs."
A former Shell service station attendant in Düsseldorf told Deutsche Welle how the system works: "You monitor a select number of competitors near your station up to three times a day and more if you have time," the former employee said. "You enter the name of the competitor and its price into a terminal, which is connected to the headquarters in Hamburg. You're informed of price changes at the cash till."
And the prices can fluctuate frequently. "I once experienced six different price changes on my shift," the former Shell attendant said. "And you can imagine in which direction they went."
Author: John Blau
Editor: Sam Edmonds