France extends fuel subsidies to shield consumers from skyrocketing energy prices

The French government has announced plans to extend fuel subsidies, totaling €450 million, until the year's end in an effort to alleviate the economic strain caused by the Middle Eastern conflict. Economy and Finance Minister Roland Lescure reassured the public, stating that these concerns are genuine and that action is being taken to address them.

The subsidies will cover non-road diesel for farmers at a reduced rate of €0.15 per liter, and construction company trucks at €0.20 per liter. Additionally, low-income drivers who need to use their vehicles for work will receive a doubled subsidy, from €0.20 to €0.40 per liter. Budget Minister David Amiel expects the country will spend a total of €1.4 billion on these subsidies this year.

France has been employing targeted fuel subsidies to combat rising energy prices, rather than implementing blanket tax cuts which could worsen the country's already precarious fiscal situation. The situation worsened in March when the government began favoring targeted subsidies over broad tax cuts. The ongoing conflict in the Middle East has driven oil prices to their highest levels since May, while gas prices have nearly doubled since the U.S. and Israel bombed Iran in February, leading to the closure of the Strait of Hormuz.

French President Emmanuel Macron has been actively raising awareness about the impact of global conflicts on fuel prices and has convened a special G7 meeting to address the rising energy costs. He has also urged European Commission President Ursula von der Leyen to relax EU rules on fuel quality and methane emissions. Macron discussed the issue with U.S. President Donald Trump, who proposed a moratorium on energy sector strikes between Ukraine and Russia.