Motorists will not complain. At French petrol stations, fuel prices continue to fall. During the week ending Friday 13 September, a litre of diesel (diesel) fell on average below 1.60 euros, according to data from the Ministry of Ecological Transition. This is the first time since January 2022, i.e. before the outbreak of the war in Ukraine, which made supplies more expensive.
For regular diesel consumers, still the majority in France, the balance sheet now shows 1.59 euros per litre, twelve cents less than at the beginning of the summer and around thirty cents less than in September 2023. This trend is also observed, to a lesser extent, for the litre of petrol. On 13 September, the average price of 95 unleaded stood at 1.72 euros, which is a drop of around 13 cents compared to the beginning of July.
“Prices at the pump remain relatively high”“qualifies Olivier Gantois, president of the French Union of Petroleum Industries (UFIP). Diesel, for example, was sold for less than 1.50 euros on average in 2019. In any case, “Motorists need their cars whether prices go up or down., remember. Therefore, there is no elasticity of demand for fuel in relation to prices.”.
For all types of fuel, taxes represent a significant part of prices. The various taxes (on value added and on the consumption of energy products) alone account for 55% of the price indicated on 13 September for diesel, and nearly 57% for 95% unleaded, according to the UFIP’s count. In other words, significant revenue for the State.
“Divergence of opinions on demand growth”
It is true that pump prices also and above all reflect the price development on the black gold market. The litre of Brent, the European benchmark for crude oil, briefly fell below $70 (around €63) on Tuesday 10 September for delivery in November. For the first time since December 2021. On Thursday 19 September, however, it recovered to end the day at $74. “This level remains generally adequate for producing countries”considers Edouard Lotz, analyst at the consulting firm Omnegy.
Several factors explain why the price of a barrel of Brent is still far from its April levels, or even from autumn 2023, when it was close to $90. The fall is motivated in particular by persistent market fears about a slowdown in the economy in China, Europe (where industry is in decline) and the United States. This could result in lower than expected demand. “The manufacturing sector is key for the consumption of petroleum products”recalls Jérôme Sabathier, head of the economic and environmental assessment department at the French Institute of Petroleum and New Energies.
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