New Caledonia: An interprofessional agreement between oil companies and the government signed for a reduction in the price of fuel for certain professionals

An agreement to help certain professionals cope with the sharp rise in fuel prices, which have become a major brake on the New Caledonian economy, was concluded between the government of New Caledonia and the oil operators, Mobil, Total Energies and the Société de Petroleum Services. This contract makes it possible to benefit from a reduction of 3 CFP Francs (0.025€) per liter for certain professionals: ambulance drivers, school transporters, and farmers whose turnover is greater than 1 million CFP Francs (approx. 8400€ ).

A gesture conceded by the oil companies to support the New Caledonian economy, but which does not resolve the situation in any way according to Axel Billet, farmer in Pouembout, questioned by our colleagues from CALEDONIA : “At the end of last year, I had a 3000 liter tank for 240,000 francs (2015€), today it is 330,000 francs (2770€). There is almost 90,000 francs (755€) difference… Until when? Couldn’t we find a permanent solution? And then we are coming to the end of the course, but for the young people it will be very, very difficult”.

Same observation for Marie-Josée Lethezer, manager of a passenger transport company, who cannot pass on the increase to her prices, as it is so important: “At the moment, we are almost at the end of the balance sheet, we small businesses. The increase is costing us too much. My fuel budget was 25,000 francs (210€) per week, at present, we are at 34,000 Francs (285€)”.

It is in this context that oil operators have been called upon. If they initially declined any intervention, because of too low margins, this selective agreement finally made it possible to find common ground. However, as explained by René Fere, representative of Société de Services Pétroliers speaking to Caledonia, the problem of low margins remains: “We are limited by our margin. We have a margin that is fixed per litre, regardless of the fuel price. We have a gross margin of 14 Francs, giving 3 Francs is a little less than 30% of the gross margin. Compared to that, the risk is to go below our cost price, with a law that prohibits it, it’s called dumping, that’s why we are forced to stay within this margin there, acceptable and legal”.

Damien Chaillot

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