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France’s Fuel Supply Problems Worsen As Refinery Strikes Continue

France’s fuel distribution continues to be disrupted by the ongoing strikes at refineries with no end in sight to the industrial action that has left more than 60% of French refining capacity offline.

The current refinery outage in France is due to a strike of refinery workers over disputes over pay. More than half of France’s refinery capacity is currently offline due to the strikes. Traders of diesel and other products in Europe are concerned that the uncertain timing of the return of that capacity could further tighten the market just ahead of the EU embargo on Russian oil products early next year.  

The fuel supply situation has worsened in the past week. As of Saturday, more than a fifth of gas stations in France had supply issues, the energy ministry said, as quoted by Reuters. In some areas, such as the Ile-de-France region around Paris and in Hauts-de-France in the north, a much higher share of gas stations are running out of fuel, while drivers in and nearby Paris are queuing to fill up their tanks at those stations where fuel is still available.

“The Government is doing its utmost to restore the situation to normal as soon as possible”, Energy Minister Agnes Pannier-Runacher said this weekend.

Workers at refineries owned by TotalEnergies and ExxonMobil have been on strike for three weeks now due to disputes over pay. Exxon already said at the end of September that it was temporarily limiting the supply of refined petroleum products to its customers in France after strikes at its refineries forced the U.S. supermajor to shut down its two French facilities.

Negotiations continue, but on Monday, the CGT trade union rejected an offer from TotalEnergies, which had offered to bring forward negotiations if the union called off the strike.  

“This attempt is perceived as blackmail by the CGT and does not guarantee satisfaction of the demands expressed and therefore the return to work,” the union said as carried by Reuters.

The strike has already prompted France to look to import more fuels, which has sent profit margins for northwest European diesel barges soaring to the highest since the beginning of March.

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By Tsvetana Paraskova for Oilprice.com

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