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Episode 11

Why Do Petrol Prices Change So Many Times a Day?

German petrol stations changed prices 22 times a day. A noon rule cut that to 6 or 7, and margins rose. Here is why stations keep watching each other.

5 November 20267 min readVideo 8:22

Petrol changes its price all day because every station can see every rival's price within minutes of it changing, and keeps reacting to it, often through pricing software. Before Germany's noon rule, the average German station changed its price 22 times a day. The rule cut that to 6 or 7, but rules about when prices may rise also tell every station when the others will rise, so prices became more predictable without becoming cheaper.

Watch the episode: Germany Tried to Calm Petrol Prices. They Went Up. 8:22

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Germany's noon rule

Since 1 April 2026, German petrol stations may raise their prices only once per calendar day, at 12 noon. Cutting prices is allowed at any time. Breaking the rule can be fined up to 100,000 euros. The bill was a reaction to sharp price rises at the pump.

By May, the drivers' club ADAC measured what happened at noon: E10 rose by 14.6 cents a litre and diesel by 18.4 cents on average. I wanted to know why petrol moves all day in the first place, and why a rule against that seems to have made it dearer.

Who is watching your petrol price?

In 2014, German stations changed their prices 4 to 5 times a day. Before the noon rule, it was 22. I assumed that meant stations were fighting harder for my money.

Since 2013, Germany's Market Transparency Unit for Fuels has collected every price. Each change must be reported within five minutes, and the prices go to consumer information services, so drivers see them in an app, online or on the sat-nav. Drivers are not the only ones checking.

The competition authority had looked at this before. In 2011 it found that five companies held 65% of sales: BP/Aral, Jet, Esso, Shell and Total. All five used a system for monitoring prices. Aral or Shell led the rises and the others followed; one adjusted its price after exactly three hours. The authority's head, Andreas Mundt, said the five large operators were not competing with one another.

Then came software. By mid-2017, algorithmic pricing software was widely available to German stations, and its inputs include competitors' prices. When one of two neighbouring stations adopted it, market margins did not change. Where both did, they rose 28%. One Danish firm, a2i, claimed its software could improve margins by around 5 percent, which is the company's own claim.

The saw: what an Edgeworth cycle looks like

Draw one station's price across a day and you get a saw: a sudden jump, then a slow slide of small cuts. Stations undercut one another in small steps, because a difference of 1 cent a litre between two nearby stations has a large effect on how much each sells.

The price cannot slide below cost forever. Near cost, each station waits for the other to raise first, since going first means losing drivers. Then one resets the price in a single jump and the other follows immediately. Michael Noel timed this in Toronto, where one-time increases of 10 cents a litre were common and the undercutting phase lasted over twelve times longer than the jump. Smaller firms tended to start the undercutting; larger firms started the new rounds of rises.

Economists call this an Edgeworth cycle. Maskin and Tirole gave it a theory in 1988, long before fuel apps. In Germany before the rule, prices had seven to eight peaks a day. They were highest between 7 and 8 in the morning and lowest between 7 and 8 in the evening.

What happened when prices could rise only once a day?

Austria got there first. It limited price rises in mid-2009, and since 2011 rises are allowed only once a day, at noon, with the stated aim of pushing competition downwards. Economists at ZEW found the evidence from Austria inconclusive, with no clear effect on average prices. In spring 2026 Austria tried allowing rises only on Monday, Wednesday and Friday; that lapsed in less than a month.

In Germany, the government said price changes fell from 20 to 22 a day to 6 or 7 and drew a positive verdict. The noon jump told a different story:

Period	E10 jump at noon	Diesel jump at noon
First 2.5 weeks of April 2026	about 9 cents	10.5 cents
May 2026	14.6 cents	18.4 cents

On a 50-litre tank, 14.6 cents is 7.30 euros, for filling up just after noon instead of just before. ZEW found average petrol margins rose 5 to 6 cents a litre, with no significant effect on diesel. The rule cut the daily cycles from eight to one and increased price transparency, but failed to reduce price levels.

That is the saw with one tooth, at the same minute, at about 15,000 stations. Nobody has to wait for someone else to go first: the law says when. A 2012 lab experiment had found regulated prices less volatile but higher, with the rule making collusion easier rather than harder.

Some stations did not even wait for noon. An SWR analysis found about 60,000 suspected illegal price rises at about 3,800 sites in the first 3 weeks of April. By September, ADAC said the gap within a day had widened markedly and called for the rule to go. In October, the Bundesrat, the states' chamber, asked for it to be lifted.

Can petrol prices ever sit still?

Western Australia tried 25 years ago. Under FuelWatch, since 3 January 2001, Perth's stations submit the next day's price before 2 pm, post it at 6 am and keep it for 24 hours. Drivers can see tomorrow's price. So can every rival, perfectly.

Economists Byrne and de Roos followed the chains. Caltex's share of price jumps on Thursdays went from 20% in January 2010 to 92% by June; BP moved its jumps from Wednesday to Thursday. Perth's average margin went from 4.85 to 10.01 cents a litre. Part of that was a national trend (relative to other cities, the effect was 3.49 cents), but the study concluded the dominant firms used price leadership to coordinate prices and raise margins. In October 2026, Western Australia still warned Perth drivers that prices would rise by over 9 cents a litre from 6 am the next day, and that the cheapest station could save about 28 Australian dollars on a 60-litre tank.

Victoria's Fair Fuel Plan, from 10 March 2026, has retailers set the next day's maximum price by 2 pm, to give drivers clearer notice. By May, drivers reported big swings each morning at about 5:30 am.

In Norway, from Easter 2004, every Monday morning all companies raised prices to the recommended price; Thursday rises were added later, until Circle K broke the pattern in November 2017. Now it is hard for customers to know when prices are lowest, and the competition authority bars Circle K, YX and Uno-X from publishing recommended prices online until 15 October 2030.

Switzerland has no real-time price app like its neighbours, and its competition commission found no signs of price-fixing in 2022. In 2016, BP changed its Swiss prices 21 times. That was for the whole year, while German prices changed six times a day.

Look at the clock when you fill up

Rules about when prices may rise were written for drivers. The stations read them too. In Germany, the cheapest time to fill up is now just before noon. In Perth, you can look up tomorrow's price before you go.

So, when do you fill up? And have you ever watched the price jump, right at the pump?

Sources

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