Well this is something I never expected to see again: fuel rationing in British petrol (gasoline) stations. The last time I can remember anything like this happening was during the fuel crises of the 1970s. This time, however, it's not (directly) OPEC's fault.

Tax on fuel across Europe is generally a lot higher than it is in the US which means that our petrol costs 2-3 times as much as American gas does. In Britain, which has the most expensive fuel in the world, we pay the equivalent of $6.50 a gallon (now do you see why we prefer to drive small, fuel-efficient cars). The prices in France are considerably lower than they are here in the UK, but still high by US standards.

Last week the French truck drivers, farmers and taxi drivers decided that they'd had enough, and in classic French style decided to take direct action to try to force their Government to reduce the taxes. They took their vehicles and began blockading the fuel distribution depots. Within two days petrol stations across France had begun to run short of fuel, within 4 days over 90% of them were shut. In the end they did win some concessions from their Government.

In the UK as of the end of last week we are now seeing the same thing. The news today is reporting that 2/3 of petrol distribution centres in Britain are now beseiged by lorry drivers and farmers' tractors. Over 500 petrol stations have completely run out of fuel, and many others are rationing petrol so that each person can only purchase £5 (about 1.5 gallons) at a time. Meanwhile the Government is saying that they categorically won't reduce the tax on petrol.

Britain is different to France in one crucial respect: it's an island. Some economists are saying that if this continues for more than a couple of days the supermarkets will start running out of food (no fuel for the delivery lorries). I can remember the petrol rationing and power cuts from the 1970s but I've never experienced food rationing, and from the things my parents tell me about it, I don't particularly want to. However I agree with most of what they are protesting about, as I know a few lorry drivers and know exactly how expensive it is to keep haulage vehicles on the road in this country.

On top of all this, there are also reports that similar tactics are being used in Ireland, Spain, Germany, Belgium and Italy: at this rate there will be no petrol available anywhere in Europe! Strange, strange world.


Update September 12, 2000: Britain is rapidly running out of fuel. According to the television south Wales is completely dry, and the northwest and southwest of England are not far behind. Personally on my way into work this morning I did a quick count: I passed 13 petrol stations, 9 of which were completely sold out, 1 was selling diesel only, and the remaining 3 had queues of traffic stretching at least a quarter of a mile in both directions.

On a political level the Government say they are refusing to give in. The Prime Minister apparently held an emergency session of the Privy Council last night where the Queen approved the use of unspecified "emergency powers" if necessary. The whole country isn't quite in a state of emergency yet, but it's getting worryingly close..

As Tommy said in his writeup in dump the pump, the higher prices for petrol have not cured the world of increased demand for what is ultimately (as the current thinking goes) a non-renewable natural resource.

In the long term, the only cure for high prices is high prices. Only a high price will eventually encourage the market from the bottom up to move towards more fuel efficient cars, better use of available oil and the development of alternative sources of energy. Note that it was during the last oil shock of the 1970s that super petrol guzzling cars went out of fashion in the U.S. and that the developed world moved towards being less dependent on crude oil supplies from the Middle East.

The reality of the current situation is that the raised price of crude oil from US$10/barrel in 1998 to US$35/barrel recently have still not caused any significant drop in demand (demand is in fact rising from Asia as it recovers from the Asian Financial Crisis of 1998-1999).

Attempting to cut down the price of crude oil by pumping more oil is about as good as pushing on a string.

Personally, I think that the protestors against the high price of petrol are just as misguided as the protestors currently at the World Economic Forum in Melbourne - both protests have almost no chance of success and are causing a lot of damage to innocent bystanders.

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