The price of oil, already at a high level due to a stagnation in world production, has experienced a surge since the start of the Russian invasion of Ukraine.
Inflation directly visible on the prices at the service station, gasoline suffering the brunt of this increase.
How high will the prices go, and is there at least a limit?
If you find the price at the pump to be expensive right now, give yourself a good ventilation, because it's probably only the beginning.
While a liter of gasoline or diesel blithely exceeds 2 euros in many service stations in France, the war in Ukraine and the economic conflict between Russia and the West may well make things worse.
How far ?
Hard to predict, but potentially high, very high.
"Depending on the turn of events, a liter of gasoline at 3 euros is possible, even plausible," warns Bernard Keppenne, chief economist at CBC Banque.
It's well known – and somewhat reassuringly – “trees don't reach to the sky”.
In other words, the market always ends up finding a limit to the rise in prices.
But as far as black gold is concerned, this glass ceiling is unknown: “Generally, the limit is when the price becomes so high that it no longer finds a buyer.
However, oil is so essential for many economic activities of our societies that this breakthrough price has never been reached”, informs Philippe Crevel, economist and director of the Cercle de l'Epargne.
So much the better, moreover, because reaching the breaking price “would amount to shutting down our societies”, indicates the expert.
sky is the limit
All eyes are obviously on Russia, the world's second largest exporter.
Moscow could on the one hand decide to cut its sales to the West, even if this has very serious consequences on its own economy, reassure the two experts.
Something to seriously make the country think, already in the midst of an economic crisis.
But another option could remove Russian oil from our gas stations: for the West to stop importing itself.
An option advocated by the United States, which can easily be self-sufficient in oil as the world's largest producer.
But for other countries, such a solution would look like economic hara-kiri: "The Germans, extremely dependent on Russian gas and oil, have already said that they were not in favor of this option", notes Bernard Keppenne .
If such an embargo on Russian raw materials took place, it would have serious consequences on prices.
"In this scenario, the liter of gasoline is likely to climb very high," warns the chief economist.
Same observation with Philippe Crevel: “An embargo would create enormous tensions on the market, as well as panic buying movements, which would only increase prices even more”.
Irreplaceable Russia
The liter of gasoline at 3, 4, 5 euros could even become a secondary problem: "We would risk entering into a logic of rationing, where companies would be asked to stop producing during certain periods, where there would be restrictions imposed on the circulation of cars, planes…”, advances Bernard Keppenne.
One does not, in fact, do without Russia so easily.
Especially in Europe, where Moscow accounts for 27% of black gold imports.
“The production of the other OPEC countries seems to be coming to a standstill.
Iran is banned from the European market, and even if we lifted this ban, it's not sure that Tehran would agree to play the service firefighters for the West,” remarks Philippe Crevel.
Importing oil from the United States – across the Atlantic – would be very expensive and would require major reorganization.
Closing?
“In the short term, we will suffer, because even if we manage to find something to replace Russian oil, it will not happen in a few months”, warns Bernard Keppenne.
And besides, this is only the beginning
Of course, Europe has strategic reserves to hold out this winter.
But that only shifts the problem: “The rebuilding of stocks takes place at the end of winter, beginning of spring.
Or in just a few weeks.
The current crisis is likely to have a severe impact on our stock for next winter”, notes Philippe Crevel.
Because this crisis is set to last, especially since the war adds to a structural problem: "World oil production may have reached a peak, and investments in the search for new high-productivity fields have ceased.
Consequence: the price was already rising before the start of the conflict, ”recalls the director of the Cercle de l'Epargne.
A possible cut in the Russian tap could relaunch the search for these deposits.
But that too will take time.
Dark months therefore await the French on the price side at the pump: “Depending on the course of the crisis, we are probably set for two, three years of high oil prices.
And yet… In the event of a Russian embargo, two or three years, that looks like an optimistic scenario”, warns Bernard Keppenne.
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War in Ukraine: Are the French ready to lose purchasing power?... "It will depend on the legitimacy they give to this conflict"
War in Ukraine
Gasoline
Russia
Oil
Economy
Gasoline prices
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