German Chancellor Gerhard Schroeder said record oil prices are hurting the German economy and crimping consumer spending, a magazine reported on Friday. "It's clear that high (gasoline) prices are a burden for consumers and the economy," Schroeder said in an interview with "motorwelt", the magazine of German motoring club ADAC.
"The current gasoline price development is determined purely by the rise in oil prices," Schroeder added. Analysts have warned oil costs are putting extra pressure on Germans' wallets and helping to hold back a recovery in one of the weakest areas of the country's export-reliant economy.
Private consumption shrank 0.3 percent in the second quarter of this year, a second straight decline, data showed on Tuesday. Oil prices surged to a record $68 a barrel on Thursday and were holding firmly above $67 on Friday.
With no end in sight to a rally that has pushed oil towards an inflation-adjusted $82 reached in 1980, some governments are urging consumers to conserve fuel. The French government on Friday said oil prices were likely to remain high "for a long time" and urged citizens to improve efforts to save energy.
Schroeder told "motorwelt" there were no plans to scrap an unpopular "ecological tax" on fuel and said the government was using revenue from the levy for urgently needed reductions in non-wage labour costs.
Comments
Comments are closed.