“Politicians lack competence”: how the energy crisis is developing in the West

The cost of a gallon (3.785 liters) of gasoline in the United States again broke a historical record, exceeding $ 5, as evidenced by data from the American Automobile Association.

As noted in the organization, the dynamics between a reduction in supply and an increase in demand for gasoline provokes an increase in prices.

“Combined with rising crude oil prices, this means gasoline prices are likely to remain high for the foreseeable future,” the association said.

In addition, the US Department of Energy Information Administration (EIA) on June 10 reported that gasoline and diesel prices, as well as refining margins, were significantly higher than historical averages, in particular due to a decrease in exports of Russian petroleum products.

Other reasons include low inventories of both types of petroleum products both in the United States and around the world, an increase in fuel demand to pre-pandemic levels, and relatively low production of both fuels compared to pre-COVID-19 levels. .

“We expect that during the summer, wholesale fuel prices will significantly exceed those of previous years, due to rising crude oil prices, as well as the continuing effects caused by low global reserves (petroleum products.

).

It is likely that the scarcity of world reserves will become even stronger due to the ban on energy imports from Russia, which was recently announced in Europe, ”the EIA explained.

However, despite such arguments, the White House continues to blame the Russian authorities for the current situation.

Thus, the President of the United States, Joe Biden, during a speech in Los Angeles, justified the increase in retail gasoline prices with the “Putin tax”, which the Americans supposedly now have to pay.

European problems

However, the difficulties associated with the rise in the price of energy resources are observed not only in the United States, but also in a number of European countries.

Thus, as noted by the General German Automobile Club (Allgemeiner Deutscher Automobil-Club eV, ADAC), fuel prices in Germany - regardless of the state discount on gasoline - are "generally too high."

“The prices are still very high.

The antitrust agency, as a neutral body, must determine that the discount does not work, and the politicians must act.

Because now the taxpayer is supporting the profits of the oil industry, which, obviously, is using the crisis to maximize revenue at the expense of consumers,” said ADAC fuel price expert Christian Laberer.

At the same time, the German government does not intend to provide emergency assistance to the population in connection with the rise in the price of gasoline and other energy resources, as well as a significant level of inflation.

This was stated by German Finance Minister Christian Lindner.

In particular, we are talking about extending to pensioners a one-time payment for electricity in the amount of €300.

“There are no reserves in the federal budget for 2022,” Lindner said.

According to him, "the federal government has reached its financial limit."

• gas stations in Germany

• Gettyimages.ru

• © Sebastian Kahnert/picture alliance

A one-time payment of such a “subsidy” to pensioners would cost the local authorities and Berlin € 5.3 billion, according to the T-Online portal.

At the same time, the fact that pensioners, as well as students, will not be able to receive a lump sum payment has caused significant criticism, including from public associations, the newspaper writes.

Earlier, the Minister of Economy and Climate Protection of Germany, Robert Habeck, spoke about the campaign to save energy in the country.

According to him, this will help Germany become more independent of Russian imports.

In particular, it is proposed to increase the temperature in the refrigerator to seven degrees, pay attention to the temperature of the water in the bathroom, and also use the economical operating modes of dishwashers and washing machines.

Meanwhile, in the Czech Republic, they informed that over the past week the cost of 1 liter of gasoline at the republic's gas stations has increased by an average of 79 hellers, to 46.55 crowns (about $2.2).

In Poland, motorists and motorcyclists have begun blocking gas stations across the country in protest against rising fuel prices, local media reported.

At the same time, MP from the Civic Coalition Pawel Ponciliusz told Polskie Radio that the government hastened to implement a complete embargo on Russian coal imports.

In his opinion, the sudden reduction in supplies will hit ordinary Poles to a greater extent.

Previously, residents of Poland were allowed to collect brushwood due to the embargo on coal from Russia, but this is allowed only after special training and on condition that branches no longer than 7 cm are collected.

In France, the price of gasoline topped €2 last week in what local media called an "unheard of" phenomenon, recording a price increase of 30% since the beginning of the year.

In addition, Western media reports that now in the UK, with an average price of £1.82 ($2.28) per liter for unleaded petrol, motorists will have to pay £100.3 to fill up a car with a standard 55-liter gas tank.

As writes The Guardian, a record increase in fuel prices could provoke a massive exodus of employees who have to get to work by car.

Also citing the UK trade union GMB Union, similar data are provided, indicating that many employees of British companies using personal vehicles for work, as well as taxi drivers, may soon begin to quit due to rising gasoline costs.

It should also be noted that against the backdrop of rising fuel prices in Europe, the cost of natural gas for the population is also growing.

Thus, from July 1, the Latvian company Latvijas Gāze intends to raise tariffs for this energy resource by 65.6-89.9%.

"Act in a rush"

Experts note that the population of Western countries is now faced with the consequences of politically motivated steps by their own authorities, who initiated restrictions on the import of Russian energy resources, knowing full well how this will affect ordinary citizens.

“Limiting the supply of Russian energy sources, first of all, had an extremely negative impact on the level of gasoline prices in Western countries.

The rapid increase in its cost primarily raises concerns about socially vulnerable groups of the population, ”said Alexander Frolov, deputy director general of the National Energy Institute, in an interview with RT.

He also recalled that the rise in gasoline prices is directly related to oil prices on the world market.

“There is a direct relationship between fluctuations in oil prices and motor fuel prices both in the US and in the EU.

And these pricing processes are strongly influenced by the restrictions that have been introduced and are now being introduced against Russian oil and oil products, as well as the fears of many players associated with this that there will not be enough black gold on the market as a result, ”Frolov explained.

• Tankers with Russian oil

• AP

According to Vladimir Olenchenko, senior researcher at the Center for European Studies at IMEMO RAS, anti-Russian sanctions, which "actually hinder continental and global trade in energy resources, cannot but affect Western countries."

“And the first to feel the negative consequences were precisely those states that consider themselves the authors and executors of these restrictions.

All this leads to a further increase in the prices of gasoline and other energy sources, ”the analyst said in a conversation with RT.

At the same time, from the point of view of Alexander Frolov, the most difficult situation is now observed in Europe.

“There are various taxes on petroleum products and motor fuels in the EU states.

Due to local tax laws, Finland, Denmark, Greece, the Netherlands and Germany are among the top five countries in the association in which consumers pay the most for gasoline.

The price of fuel in the European Union is also affected by the fact that since the beginning of 2020 there have sharply tightened the requirements for its environmental performance.

What has been done in many ways to ensure that consumers switch to electric vehicles,” says Frolov.

Vladimir Olenchenko, for his part, considers decisions to limit Russian energy imports ill-considered.

“The US, like Europe, is acting in the heat of the moment.

They expected that such measures would negatively affect mainly Russia, but it also rebounded on the United States.

This is evidence that Western politicians lack competence: many slogans, but little calculation.

Of course, this first of all has an extremely painful effect on the population, which begins to express dissatisfaction, for example, as in Poland.

It is possible that both Europe and the United States may approach the line, which will be followed by protests, ”Olenchenko argues.

Alexander Frolov does not see any prerequisites for the end of the energy crisis in the West in the short term.

“Perhaps, some chances for this may appear only by the end of the year, and even then, if the EU and the United States do not recklessly follow their own restrictions on the supply of oil and other energy resources from the Russian Federation, and also if the European Union does not continue to impose restrictions on Russian energy sources ', concluded the analyst.