March 25, 2023

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The French government is ready to step in to lift the blockade of the country’s refineries

The French government has said it is ready to step in to end an oil refinery strike that has been going on for several weeks.

Due to strikes taking place at oil refineries in France, a third of the country’s gas stations have run out of fuel.

Strikes and unplanned maintenance at refineries in France, run by oil majors TotalEnergies and ExxonMobil, have shut down more than 60 percent of the country’s refining capacity and blocked distribution from fuel depots, Reuters reports.

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This has been going on for too longFinance Minister Bruno Le Maire said hours after Prime Minister Elisabeth Borne held a crisis meeting with ministers late Monday night.

Le Maire said the French government was prepared to call back on strategic fuel reserves and order strikers back to work.

If the shutdown persists, we will have no choice but to requisition the necessary means to restart the refineries and open the fuel depots. We’ve been talking for a few hours, a few days at the most“, he added.

Endless queues at gas stations in France

The refinery strike caused long queues at petrol stations in Hexagon and impacted European markets at a time of global shortages of distillates such as diesel.

Benchmark European diesel refiner margins hovered near an all-time high of $77.25 a barrel hit on Monday as industrial action severely tightened supply.

TotalEnergies’ 240,000-barrel-per-day (bpd) Gonfreville refinery is offline, while refined product deliveries are blocked at the 119,000-bpd Feyzin refinery, which is closed for unplanned maintenance but which has fuel in storage, and at Cote d’Opal and La Mede fuel depots.

Two Exxon Mobil refineries have also been shut down since late September.

Exxon Mobil’s French division, Esso France, said it had reached a wage deal with unions. Even so, it will take time for the supply to be unlocked, Transport Minister Clement Beaune said.

Esso France said unionized CFE-CGC and CFDT workers, who represent the majority at its plants, agreed to a 6.5% pay rise offer in 2023 and a 3,000-euro bonus. These terms meant a total salary increase of 10.7% plus 4,000 euros in bonuses between January 1, 2022 and December 31, 2023, the group added.

But the CGT union said it had not signed the deal and its workers remained on strike. It is asking for a 10% increase in the next round of wage increases.

TotalEnergies offered on Monday to bring forward wage negotiations from 2023, but only on the condition that the strikes end. CGT denounced the offer as “blackmail”.

The strikes have amplified union discontent with President Emmanuel Macron, who this autumn delayed a final decision on his contested pension reform plans, fending off frustration over the cost-of-living crisis.

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