Ifo President Fuest Calls Tank Discount Harmful to Economy

Ifo President Fuest Calls Tank Discount Harmful to Economy

Clemens Fuest, president of the Ifo institute, criticised a government intervention at the fuel pump. “A petrol discount would be harmful in the current situation” he told the German newspaper “Welt”. He said that the current rise in fuel prices signals a tightening of oil supplies. “It is important that drivers feel this price signal and adjust their behaviour as far as possible” Fuest added. A discount would blunt this key scarcity signal and, in his view, harm the German economy as a whole.

After Russia’s invasion of Ukraine, the then‑coalition government introduced a petrol discount in 2022 to curb the steep rise in fuel prices. Recently, Sachsen‑Anhalt’s Minister‑President Sven Schulze (CDU) sparked a debate on “reaction mechanisms” with “Politico”, raising a petrol discount as a possible response to the escalating fuel costs.