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Yes u need to use premium fuel ..... by 1999 it was 92 unleaded but 87 will work too .... using lower fuel grades can cause detonation which is basically Knocking (also called knock, detonation, spark knock, pinging or pinking) in spark-ignition internal combustion engines occurs when combustion of the air/fuel mixture in the cylinder starts off correctly in response to ignition by the spark plug, but one or more pockets of air/fuel mixture explode outside the envelope of the normal combustion front.

The fuel-air charge is meant to be ignited by the spark plug only, and at a precise time in the piston's stroke cycle. Knock occurs when the peak of the combustion process no longer occurs at the optimum moment for the four-stroke cycle. The shock wave creates the characteristic metallic "pinging" sound, and cylinder pressure increases dramatically. Effects of engine knocking range from inconsequential to completely destructive.

Knocking should not be confused with pre-ignition. They are two separate events, however, pre-ignition is usually followed by knocking..

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Q: Do you need to use premium fuel in a 1999 e320 Mercedes?
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