Fuel prices: the government is considering new aid "for French people who work"

The price of diesel reached an unprecedented level in France on Friday, September 18; the government promises to continue its aid to active individuals after September 30, without yet specifying the details. The surge in fuel prices since the end of February, caused by the war in Iran, fuels social tension already materialized Thursday by the blockage of oil depots by fishermen in the Mediterranean. "It is difficult today to fill up" and "to take your car to go to work," admitted the Minister of Economy, Roland Lescure, to the Agence France-Presse (AFP), stating he heard more "anxiety than anger." According to an Agence France-Presse calculation based on the prices displayed Thursday at more than 9,000 gas stations, diesel was sold for more than 2.39 euros per liter, above the previous peak in April. SP95-E10, the most sold gasoline in France, reached 2.17 euros per liter and has been above its June 2022 peak for more than ten days. Aid to the most exposed sectors Twelve days before the end of the aid scheme for "heavy-duty vehicles" is scheduled, several ministers guaranteed on Friday morning that the support would not disappear on September 30 and hinted that the conditions for this aid could evolve, without providing details. "We are working on a new aid scheme for French people who work starting October 1st," stated spokesperson Maud Bregeon to France Inter, specifying that the continuation of the "heavy-duty vehicles" scheme was only one of the avenues being studied. The Minister of Commerce, Serge Papin, assured on TF1 that the aid would not "stop" at the end of the month and announced a meeting on Monday with the Prime Minister to set the modalities. The current system grants 100 euros to people below a certain income threshold who travel more than 15 kilometers between their home and work or travel more than 8,000 kilometers per year for their professional activity. According to Mr. Papin, 1.5 million people have requested this, which is half of the estimated 3 million eligible. The government has already extended the aid to the most exposed economic sectors, including agriculture, building and public works, and fishermen, until December 31st, and promised for the latter that the aid would be at the maximum allowed by the European Union (around 35 cents per liter of fuel today). State revenues related to fuel are decreasing The Minister of Public Accounts, David Amiel, quantified the aid package for fuels since the start of the war at 1.4 billion euros and promised on LCI announcements "in the coming days." Behind these announcements lies the executive's line: temporary and targeted aid rather than a general reduction in taxes or a price cap. The government wishes to avoid widening the deficit, which is expected to reach 5.4% of gross domestic product (GDP) in 2026, compared to 5.1% last year. A rebate granted to all motorists cost the state 7.6 billion euros in 2022, according to the Ministry of Economy. "Lowering taxes on gasoline for everyone, including those who don't need it, costs a lot of money, it will have to be financed and it is inefficient and unfair," pleaded Roland Lescure. La France Insoumise demands a price cap of 1.70 euros per liter; the candidate of the National Rally, Marine Le Pen, wants to reduce the VAT from 20% to 5.5% on energy. The President of the Republicans, Bruno Retailleau, proposes to abolish energy saving certificates (CEEs), which finance the purchase aid for electric cars, estimating that this would lower the pump price by 15 to 17 cents. David Amiel contested the idea that the rise in fuel prices enriched the state through taxes. Between March and September, revenues for the state related to fuels would have, according to him, decreased by 10 million euros over a year, due to a decrease in the volume of fuel purchased by consumers. Emmanuel Macron must meet on Friday at the Élysée the main candidates for his succession or the representatives of the political parties in Parliament on the consequences of the conflicts in the Middle East and Ukraine on security and energy.