France runs short of diesel as Europe faces fuel supply warning

France is grappling with a severe fuel supply crisis, leading to soaring diesel prices and concerns over the impact on drivers and households, particularly in neighboring Spain. Around 15% of French petrol stations reported shortages of at least one fuel type on September 20, amounting to approximately 1,500 stations nationwide.

This issue has escalated rapidly, with the affected station count increasing from 7 to 9% in the middle of last week. While France has not completely run out of fuel, the shortages signal growing pressure on Europe's diesel market. Several factors are contributing to the fuel supply problems. Among these are disruptions to oil shipments through the Strait of Hormuz, which have reduced international supply levels, and damage to Middle Eastern oil infrastructure, further exacerbating the situation.

Additionally, Russia, a significant diesel producer and exporter, has seen its refineries damaged by Ukrainian attacks, leading to a decrease in diesel production and exports. Moscow has restricted diesel exports to ensure domestic supply for motorists and businesses. European refineries are struggling to bridge the supply gap, resulting in a sharp rise in diesel prices.

European diesel prices have reached an all-time high of around €2.39 per litre. In France, the government has capped fuel prices at certain stations to maintain affordability, but this has led to increased demand and faster sales of diesel, straining the supply chain. Spanish drivers are already facing higher fuel costs, with average diesel prices at around €1.83 per litre and petrol nearing €1.87 per litre.

If the European diesel market tightens further, Spanish prices could rise even more. Diesel is crucial not only for drivers but also for industries like agriculture and transportation, which rely heavily on it for machinery and operations. Higher fuel costs can trickle down to affect everyday goods and services. Spain, unlike France, has a robust refining industry and the ability to import refined diesel.

However, the situation remains uncertain as problems in Russia and the Middle East persist, and the global refining capacity may struggle to meet the demand. Spain's diesel discount is set to end at the end of September, potentially leading to a significant rise in fuel prices for drivers, delivery companies, farmers, and other sectors.

As Europe enters the autumn and winter months, France's empty petrol stations serve as a cautionary signal for Spain and other European countries.