Motorists must be very attentive when driving on French roads and highways if they do not want to get an unpleasant surprise when refueling. It is not a matter of filling up the tank and stopping almost urgently at the first gas station that appears, with no option to look for an alternative. The price of fuel can vary greatly depending on the oil company or distributor, up to 30 or 40 cents per liter. There has always been disparity, but now it has been accentuated due to pressure from the Government on companies to help mitigate inflation and provide relief to users.
A real trade war is underway between gas stations, a struggle that extends to supermarket chains that also sell fuel. There is an almost ethical race, of image, to appear to the population as a company with a soul, that cares about its clients and wants to help them make ends meet. In this phase of capitalism, at least in Western countries, this moral and ethical dimension of business is increasingly important. Consumers demand and compare, reward or punish.
President Emmanuel Macron and his Government know well that inflation is very unpopular and has a political cost for those in power. It can be seen in the European elections in June next year, which the extreme right would like to turn into a platform for its new assault on the Elysée in 2027.
Macron already had a terrible experience, in 2018, when playing with the price of gasoline and diesel. He wanted to introduce an ecotax, of just a few cents per liter, and the result was the yellow vest revolt, a huge public order crisis that lasted months and was very destabilizing. The president had to back down and withdrew the ecotax.
The Minister of Economy and Finance, Bruno Le Maire – a potential candidate to succeed Macron – vehemently stressed last week, in an interview with Le Parisien, that “inflation is my first fight.” His draft budget for 2024 plans to reduce the price increase to 2.6%, a goal that many consider unrealistic.
Within this strategy of stopping inflation, the Government proposed a few days ago to temporarily annul the law that prohibits selling a product with a negative margin, that is, with an insured loss. The companies threw up their hands over this idea, but some have agreed to sell the fuel at cost price.
As on other occasions, the owner of the Leclerc supermarkets, the media Michel-Edouard Leclerc, took the initiative, although his competitors immediately followed him, with the approval of the Government. Leclerc, who already shook the sector a few years ago by selling the loaf of bread, the traditional baguette, at a ridiculous price, announced that his gas stations will sell fuel at cost price until at least December 31 and, if possible, beyond. Carrefour supports Leclerc. The Casino, Cora and Intermarché chains will provide fuel at cost price two weekends a month. The Système U and Auchan gas stations will do so at least one weekend. To highlight the effort made, Leclerc recalled that the margins they have with gasoline and diesel are already minimal now, between 2% and 3%.
The giant TotalEnergies was the pioneer in capping prices. Last February it announced with great fanfare that its 3,400 service stations would sell 95 octane gasoline and diesel at a maximum of 1.99 euros, regardless of what happened in the hydrocarbon market, even on the highways, where the price It is usually more expensive. The promise has been kept and that makes this brand highly sought after and sometimes a product is sold out.
TotalEnergies felt morally obliged to take this step after having obtained more than €19 billion in profits in 2022 and in the face of political pressure. The oil company also needed to improve its image, damaged by the revelation of its activity that is very harmful to the environment, such as hydraulic fracturing (fracking) in countries like the United States. The ecological sins of the oil companies can be forgiven with generous discounts at the pump.
