RTL Today – Record fuel prices: Towards the end of fuel tourism in Luxembourg?
Will the current record prices and successive taxes on fuels sound the glass of tourism at the pump? The price gap with neighboring countries is narrowing day by day. Luxembourg is less and less attractive, but the stakes remain enormous for the State.
Fuel prices have never reached such heights in Luxembourg. This Wednesday the liter of diesel costs 1.50€ at the pump. This is a record, but also a symbolic bar never crossed in the Grand Duchy.
Fact is, for motorists’ wallets, the difference between the prices applied in Luxembourg and neighboring countries, continue to decline significantly. To such an extent that today it is legitimate to ask whether it is always commendable to come and refuel in Luxembourg?
-> The liter of diesel goes to €1.50, a record!
The difference is only 10 cents between the liter of diesel sold at a Total station in Fénétrange in Moselle (€1,607) and stations in Luxembourg, where all prices are the same. Closer, in the Esso Express station in Hayange, it is displayed at €1,659 per litre. Or 15.9 cents difference. the French official website for fuel prices indicates that, on average, diesel is at €1,685 in France. The SP95 is displayed at €1,732.
In January 2019 (the year before the health crisis) the SP95 was 26.5% more expensive in France that in Luxembourg, whereas today the difference is only 11.1%. Same for the dieselthe best-selling fuel, its price was then 33% more expensive in France than in Luxembourg, while today the difference is only 11%!
Today, with a liter of diesel set at €1.50 in Luxembourg, motorists only save 14.8 cents per liter compared to the ten best prices found in Moselle resorts. On a full 50 liters, the gain therefore amounts to 7.40 euros. For those who come from an area close to the border, it is still worth it. But coming from Metz specifically to fill up is no longer commendable.
SAME STATEMENT WITH BELGIUM AND GERMANY
In January 2019, The SP95 was 13.1% more expensive in Belgium than in Luxembourg. Three years later, the gap is only 10.6% between the two countries linked by the A6.
The shift is even clearer for the diesel. A liter of diesel was 32% more expensive in Belgium than in Luxembourg in January 2019. Today, there remains a difference of 11.4%.
The SP95 was 17.2% more expensive in Germany than in Luxembourg in January 2019, while today the difference is only 11.4%.
Same trend for the price of diesel. It was 15.7% more expensive in Germany than in the Grand Duchy in January 2019. At the end of January 2022, the price difference was only 11.8%.
A POLITICAL WILL
The Grand Duchy announced, on December 16, 2019, an increase in the price of its fuels over two years. “As the prices of diesel and gasoline in Luxembourg are well below those of neighboring countries, it is essential to gradually reduce price differences with neighboring countriesin order to reduce fuel exports”, specified the press release from the Bettel-Lenert government.
The purpose of the CO2 tax increase is to meet the country’s carbon dioxide reduction targets. This policy could today, and indirectly, carry a fatal blow to gas tourism.
A major economic phenomenon that occurs 75% of fuels sold in Luxembourg in 2019. At the time, fuel prices were, on average, 37% more advantageous in Luxembourg than in France. The comparison is not easy, because in France the prices are not the same everywhere. But on the average price practiced at that time, the price difference was at least 23 cents for a liter of diesel, sometimes much more.
The difference with the prices displayed in Belgium was even greater with an average difference of 42 centimes per liter of diesel.
A REAL FINANCIAL MANNA
Despite the health crisis linked to Covid, Luxembourg has become the European champion in 2021. According to the Luxembourg Petroleum Group, the oil sector produces tax revenue of approximately 2 billion euros per year which go straight into the coffers of the State. That is around 3% of Luxembourg’s GDP.
A financial windfall that benefits the country, which has nearly 240 service stations, or one for 2,700 inhabitants. In France, it is a station for 5,900 inhabitants.
An increase in the price of diesel compared to neighbors allows “to achieve climate objectives, but to have less tax in the coffers“, summed up a short time ago, Jean-Jacques Rommes, vice-president of the Economic and Social Council, on the airwaves of RTL. It’s time to clear things up and “know what we want“. He had asked the government to “say once very clearly where we are making this trip?“
Henri Pleimling of TotalEnergies, does not really fear for the attractiveness of Luxembourg. Simply because the border”don’t come here for pump sightseeingthey come here to work and keep our economy running“. Whether fuel prices go up or down, “they fill up” in Luxembourg.
I note that “if you walk across the border, you will notice that there are no gas stations left on the German or Belgian side, and there are just a few surviving on the French side. So people will continue to come to us, even at equal fuel prices, because there is simply no no alternatives“.
HOUSEHOLDS TOAST
Faced with energy prices that have been rising steadily for months, the OGBL asked this Wednesday for a emergency interview with Franz Fayot, Minister of the Economy, and Claude Turmes, Minister of Energy, to present to them his “package of measures to relieve households”.
To the two ministers who have just turned to the European Commission, to ask if they could pay exceptional aid to companies supported by the rapid increases in electricity and gas prices, the OGBL replies that “this are mainly households, employees and their familiesespecially low income, who advocates increasing gas, electricity, heating oil, petrol and diesel“.
The Luxembourg Consumers’ Union (ULC) had already called for the capping of energy prices and financial aid for disadvantaged households at the end of January.
Also read:
+31% over one year: Luxembourg is the European champion in fuel price increases
Luxembourg: Cost of production, taxes,… What you really pay on a liter of fuel