The numbers are irrevocable. The barrel of oil has more or less recovered the price of a year ago and the current value of the euro in dollars is not very far from it. Also, I converted into euros, the barrel of Brent s’échange, ces deniers days, between 2 and 3% plus cher qu’à la fin janvier 2022. Pourtant les automobilistes français continue à payer leur fuel nettement plus cher qu’il already a year.
That a full tank of diesel is still more expensive than it was before the war in Ukraine can be easily explained. Like many of its neighbors, France has preferred to rely heavily on Russia in recent years to meet the needs of its huge fleet of diesel vehicles.
According to the professional oil committee, in 2021, 30% of diesel sold at French service stations was “made in Russia”. And so, forced to look for new suppliers before the definitive entry into force of the embargo, the sector was forced to pay for its supplies at a higher price.
Without taxes, the liter of SP95 has gone from €0.67 to €0.86 in one year
But for the super SP95-E10, widely produced in French refineries, the “Putin” justification no longer holds up. There is rising energy costs (gas and electricity) that make refining all fuels more expensive, but in this regard, France is more or less in the same boat as its neighbours. And this is also where the shoe pinches.
When we compare prices without taxes at gas stations within the Eurozone, France appears at the top of the table. According to data compiled by the European Commission, in mid-January a liter of SP-95 E10 cost around 85.6 cents, 7.5% more than the eurozone average (79.6 cents). A very unusual differential.
A year ago, this same liter without taxes (but with margins included) was charged to French motorists 66.6 cents, 10% less than the 74.2 cents observed in the euro zone. France was still then one of the countries where, apart from taxes, the motorist was in better conditions. This has been the rule in recent years, due to the greater weight of large retailers in fuel sales.
Competition that no longer lowers prices
In one year, the situation has radically changed. The president of Ufip Energías y Movilidad (the professional union of the oil industry) does not disagree: “France is no longer the champion of fuel distribution, but it is temporary.” For Olivier Gantois, it is “the disorganization of the supply chain” that explains the current situation.
A disorganization with multiple causes: the choice of TotalEnergies to offer bonuses in addition to those of the State, the stoppages due to the fall of the refineries and, now, the union mobilization against the pension reform. On the one hand, we have motorists who have lost their usual course, some of them seeking to offset the risk of shortages that they ended up feeding themselves. And on the other, the distributors whose, explains the president of the Ufip, “the first concern was to ensure the supply of service stations and then, after the autumn strikes, replenish their stocks.”
“The effort put into the fierce competition they used to engage in has diminished,” he notes.
An observation shared by Dominique Schelcher, the president of System U, an ally of the Leclerc centers for its fuel supplies. “Since the autumn strikes, everything has not been put back in order. Our priority continues to be to have enough fuel to sell. Therefore, logically there have been fewer operations at cost price”.
“Margin Reconstruction”
Less price effort and therefore higher margins? “There were additional distribution costs and a reconstitution of margins”, admits Olivier Gantois. The System U CEO is more effective:
The slogan was not binge either. And I don’t think we are the ones who gorge ourselves the most, ”she insists.
And tomorrow? When the social storm has subsided, will big retailers continue to lower fuel prices to lure motorists into their stores? Olivier Gantois is convinced: “It’s been running like this for 60 years. I don’t think I’m risking too much by saying this competition will continue.”
“Operations will return at cost price”
An opinion, here again, shared by Dominique Schelcher: “Basically, he explains, fuel is and will continue to be a loss leader. Especially for us, since 50% of U stores are located in the countryside. The costs of Pricing operations will return, especially just before the holidays, once we have regained some composure in our supplies.”
Therefore, retailers continue to press the government to postpone the publication of the decree banning the advertising of oil products as late as possible. A request to which Bercy is not insensitive. At least as long as inflation remains the main concern of the French.
But on the side of those who, in the government, defend the exit of fossil fuels, we would prefer that large retailers concentrate their efforts on the price of food products and not on those of fuels. Therefore, the fate of this decree is not yet decided. And the possible return to France, these prices (without taxes) the lowest in Europe, depends to a large extent on their non-publication.
Source: BFM TV
