The flight seems inexorable. Fuel prices at the pump, according to the latest statements published on Monday by the Ministry of Ecological Transition, have increased by just over 3 cents on average. Despite this surge, Olivier Gantois, president of the French Union of Petroleum Industries (Ufip), believes that prices will not increase in the short term. Unless there is a global oil supply crisis.
Is the increase of 3 cents already a direct consequence of the war in Ukraine?
OLIVIER GANTOIS. Yes. Russia being the third largest producer of black gold in the world, with 10 million barrels per day, the war in Ukraine necessarily created tensions. Last week the price of Brent, the reference for the price of oil in Europe, oscillated between 98 dollars (88 euros) and $104 (93 euros). This has an instant consequence on prices at the pump in France. This week, we are seeing the same trend again. Prices will therefore remain at high levels.
Should the motorist fear a flight if the conflict continues?
No not necessarily. Current prices already factor in the risks associated with the conflict in Ukraine. We estimate that it inflates the price per barrel by 5 to 10 dollars. If the current situation persists, there is no reason for fuel to cost more in the short term. The only thing that could drive prices up would be a real oil supply crisis. If the West decides on an embargo on Russian oil, or Vladimir Putin chooses to turn off the tap, then we could see a significant increase in prices at the pump. Today, there is no risk of a shortage.
Does this scenario seem conceivable, given the geopolitical tensions and the unprecedented sanctions decided by the West?
This seems rather unlikely to me, the two parties have too many economic interests in common. Russia’s dependence on Europe is too extraordinary for Vladimir Putin to choose to deprive himself of the income that this represents. Unless it compensates for these losses by turning to its Chinese ally, and Europe manages to supply itself with oil elsewhere. Even if this game of communicating vessels sets in, the global market cards would be reshuffled, and this would inevitably lead to a generalized rise in prices.