Fuels. Record price for diesel, the government reacts

After having returned to their pre-health crisis level, fuel prices continue to soar in France. Diesel, which remains the most used in France, has thus exceeded its peak in 2018, a year whose end was marked by the movement of yellow vests.

In early October, it reached a record average price of nearly 1.54 € / l according to official government monitoring. But according to the pump price comparison engine carbu.com, its current average price is almost € 1.57 / l. Just below its historical record, the SP95-E10 averages 1.61 € / l depending on the first source and 1.64 € / l depending on the second. As for unleaded 98, it requires € 1.69 / l according to the Government and € 1.73 / l according to carbu.com. In some stations, the liter of gasoline sometimes reaches 2 €.

The surge in fuel prices is mainly caused by the recovery of the economy and by the increase in global demand after months of limitations due to the pandemic (including on production). An increase that is combined with that of the price of crude oil. The Brent barrel used as a benchmark, which cost less than $ 55 last January, is now asking around $ 85 after rising $ 10 in just one month. In addition, there is a surplus of demand in certain countries which use oil as an alternative energy source at the industrial level in order to compensate for the strain on gas. For French motorists, the price of a full tank has increased from € 10 to € 15 in one year.

The State appeals to distributors

Barbara Pompili, Minister for the Ecological Transition, spoke about fuel prices to MPs.

“” We will first make sure that distributors play the game and that none of them take advantage of the situation to increase prices at the pump excessively to the detriment of the most modest French. (…) I also ask distributors to take action in these difficult times by reducing their margins. I of course reserve the possibility of bringing them together if necessary. ” “

The always verbose Michel-Édouard Leclerc, president of the strategic committee of E. Leclerc, indirectly retorted at the microphone of BFMTV that the margin earned by its service stations was only one to two euro cents per liter. Distributors are prohibited from selling at a loss and, according to the UFIP (French Union of Petroleum Industries), a motorist who pays for his fuel at cost does not save more than 5 cents per liter.

What about a reduction in taxes?

Taxes represent around 60% of the price of fuel in France and could therefore constitute a lever for lowering prices. The mayor of Paris, Anne Hidalgo, campaigning for the 2022 presidential election, recently recalled this, saying she was in favor of a temporary reduction in VAT on gasoline.

The Government does not rule out resorting to this type of measure but remains very cautious on the issue. ” We will not leave our citizens without a solution to this increase in fuel prices, in particular the many French women and men who need their car to go to work every day. », Said Barbara Pompili. Gabriel Attal, government spokesperson, for his part indicated on BFMTV: ” As these increases continue, (…) we would consider protective measures. (…) Will it be tax cuts or aid? The decision is not made. “

But lower prices could also come from producers. The OPEC (Organization of Petroleum Exporting Countries) would indeed like to stabilize the price of a barrel of crude oil between $ 65 and $ 75, which is the range in which it was before its fall soaring. The wallet of motorists could therefore soon experience a respite, but nothing concrete has yet been announced.

Sources: Government, BFMTV, Les Echos, carbu.com, UFIP