BLOOMBERG – The French government proposes to overturn a 1963 rule by allowing the selling of fuel at a loss, as it attempts to find new measures to manage inflation without adding to massive amounts of public money already spent.
French Prime Minister Elisabeth Borne said in an interview with Le Parisien that the law would be suspended for a limited period of a “few months”. She ruled out the government cutting fuel duties.
“With this unprecedented measure, we will get tangible results for French people without subsidising fuel,” Borne said.
Fuel prices are an explosive political issue in France, where an increase in levies in 2018 sparked the Yellow Vest movement that spiraled into months of protests over living standards.
While inflation eased in recent months, prices at the pump have risen following a resurgence in the cost of oil. The finance ministry already leaned on TotalEnergies SE to cap the cost of gas and diesel earlier this month.
Last year, the government directly subsidised fuel costs for households at a huge cost to public finances. French Finance Minister Bruno Le Maire said earlier in September that reintroducing such measures would be an ecological, fiscal and diplomatic “aberration”.
“Everyone has to take their share. It’s normal to make big industrial firms contribute,” Borne said. “The state’s responsibility is also to cut its deficit and debt.”
