Iran Conflict Drives Up Fuel Prices and Heightens Energy Supply Concerns in Germany

The ongoing Iran war has significantly impacted Germany’s fuel prices and energy supply security, with gasoline and diesel prices rising sharply and gas storage levels dropping to historically low levels.

As of early April 2026, the average price for a liter of gasoline in Germany stands at €2.21, while diesel costs €2.36 per liter. This marks a substantial increase from pre-war prices of €1.83 for gasoline and €1.75 for diesel. The surge is closely linked to rising crude oil prices triggered by disruptions in shipping through the Strait of Hormuz—a critical route for about 30% of the world's oil shipments. Diesel prices are particularly elevated due to Germany’s higher import reliance and its significant use in industry, unlike gasoline which is more locally produced. To ease the price hikes, Germany has released portions of its oil reserves as part of an international effort, and the government has introduced a regulation allowing gas stations to raise prices only once daily at noon, while permitting price decreases at any time.

Energy supply concerns extend beyond fuel prices. As of February 2026, Germany's gas storage facilities are at a historic low capacity of approximately 20%, far below last year’s levels and lower than the European Union average of 30%. Industry experts note this level is even more critical than the 2022 energy crisis triggered by Russia’s invasion of Ukraine. While Germany imports natural gas primarily from Norway, the Netherlands, and Belgium, the geopolitical tensions in the Middle East have caused a sharp increase in shipping costs—oil tanker freight rates have jumped by about 80%. Although long-term contracts may temporarily protect household customers from price shocks, industrial consumers are facing quicker and steeper energy cost rises, with expectations that prices could double. Analysts warn that if oil prices remain above $100 per barrel, inflation in Germany could rise to around 5%. The immediate challenge lies in replenishing gas storage levels in preparation for the winter of 2026/2027.

Federal authorities maintain that current gas levels are manageable and not indicative of an immediate shortage. The Bundesnetzagentur monitors the situation closely, while the Bundeskartellamt remains vigilant to prevent price manipulation in fuel markets. Nevertheless, both consumers and industries brace for continued volatility and escalating energy costs fueled by the Iran conflict and its ripple effects on global energy supply chains.