German coalition meets ahead of Sunday talks on fuel price crisis

The leaders of Germany's coalition government are meeting in Berlin for further talks on the energy price crisis and the coalition's upcoming reform programme, sources in the coalition confirmed on Saturday.

The mass circulation Bild newspaper reported the meeting between Chancellor Friedrich Merz of the Christian Democratic Union (CDU) party, the leader of the CDU's Bavarian sister party, Markus Söder of the Christian Social Union and the two Social Democratic Party (SPD) leaders, Lars Klingbeil and Bärbel Bas.

The meeting is taking place at Villa Borsig, the Foreign Office's guest house in the north of the capital.

The coalition talks on energy prices and the planned tax and social reforms are set to continue throughout the weekend with an expanded previously announced top-level round set for Sunday. The coalition parties did not disclose the location and time of that meeting.

It is also unclear whether and in what form any possible results will be announced, but that will probably not happen until Monday.

Dispute between ministries

Earlier on Saturday, Klingbeil, who is both finance minister and vice chancellor, continued to press for state intervention to tackle high energy prices.

"The most effective thing right now is intervention in the market. We can see that in other European countries," Klingbeil told the Süddeutsche Zeitung newspaper in remarks published on Saturday.

"And I think we should have the courage to do that too," he added, reiterating his call for a windfall tax, lower energy taxes and a cap on fuel prices.

Those proposals are opposed by Economy Minister Katherina Reiche from the CSU and are also viewed sceptically by the CDU's Merz. The CDU/CSU is the majority party in the coalition.

Reiche had publicly and sharply rejected the SPD leader's proposals on Friday, which in turn angered Merz. The chancellor was "dismayed by the public spat and has urged Minister Reiche to exercise restraint," sources close to Merz told dpa.

Meanwhile prices at the pump have been soaring in Germany in recent weeks after the fighting in Iran all but halted the passage of oil tankers through the crucial Strait of Hormuz.

The government introduced a measure limiting petrol stations to raising prices just once a day, but the policy has failed to bring down costs for motorists, with record highs registered after it took effect last week.

Transport companies warn of catastrophe

Meanwhile several transport industry associations warned Merz in an open letter released on Saturday that the energy crisis is pushing many companies to the brink.

"With the outbreak of the Iran war and the resulting oil crisis, the sectors we represent are facing insurmountable challenges," the letter said.

The groups urged Merz to act quickly on the cost crisis, noting that freight forwarders, logistics companies, road haulage as well as bus, taxi and hire-car operators were particularly badly affected.

There are already increasing numbers of business closures and insolvencies, they said.

Expert: don't rely on the state to help

Monika Schnitzer, who chairs a council of economic experts that advises the German government, also spoke out against state intervention in fuel prices, saying people should drive less or at least more slowly because oil is scarce.

"Oil is scarce, we have to reduce consumption," she told the Neue Osnabruecker Zeitung daily.

Schnitzer, an economist at Ludwig Maximilian University in Munich, said most people could cope with higher fuel prices.

"We have to move away from the idea that the state always cushions everything for everyone. You should only help those who really need it," she said.