European Fuel Taxes to Stay High Despite Blockades

VERSAILLES, France, September 12, 2000 (ENS) - European Union finance ministers this weekend pledged not to reduce fuel taxes in response to high oil prices or disruptive campaigns for fuel tax cuts. Fuel taxes can add as much as 80 percent to the retail price of gas.

At an informal session of the Economic and Financial Affairs Council of the European Commission at Versailles, all 15 ministers said individually that there would be no change in policy "for economic and environmental reasons."

Truckers and taxi drivers protesting the high fuel prices blockaded roads across Western Europe today. In London, some pumps ran out as panicked people purchased as much as they could.

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Trucks lined up at the UK's Dover Ferry Terminal to cross the English Channel (Photos courtesy Freefoto.com)
In France, nationwide protests have truckers blockading fuel depots, taxi drivers disrupting traffic and fed up farmers threatening to block the Channel Tunnel.

Ministers called on oil producing states to increase production so as to reduce prices. In France, gas sells for an average of $US3.81 per gallon. German gas is a few cents less.

Michael Johnson, spokesman for the Automobile Association of Britain, pegs the average price for a gallon of unleaded gasoline in the UK this month at the equivalent of US$4.02. Norway has the continent's highest prices at US$4.30 a gallon. Spanish drivers pay the least at US$2.79.

The organisation of oil exporting countries, OPEC, Monday agreed to increase crude oil output by 800,000 barrels per day. It is the third time this year that the group has boosted production. It remains unclear whether even this will have a significant impact on prices.

They also suggested further efforts by the Paris based International Energy Agency to encourage energy saving measures and called for speedy implementation of an EU energy efficiency action plan released last April so as to reduce oil dependency.

The statement is a first coordinated European Union response to an angry campaign for tax cuts that paralysed France and has now spread to other countries. Protesters blocked roads in the EU's unofficial capital, Brussels, over the weekend.

filling Petrol shortages have appeared in several parts of the UK following several days of oil refinery blockades. Similar direct action protests have been reported in Germany and Italy, and have been threatened in Ireland.

The French government was put in an embarrassing position by the joint finance ministers' statement, since protesters last week forced it to offer wide ranging concessions to fuel tax protesters.

The "Wall Street Journal" Europe newspaper reported Monday that Dutch finance minister Gerrit Zalm said during the Versailles meeting that the joint declaration "means that France cannot continue to cut taxes."

Other countries have so far held out against the campaigns, though both the Italian and Belgian finance ministers are reported to have left open the possibility of some concessions.

To make matters worse, the euro, the common currency used in 11 European countries, is falling, making the relative price of fuel even more expensive.

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{Published in cooperation with ENDS Environment Daily, Europe's choice for environmental news. Environmental Data Services Ltd, London. Email: envdaily@ends.co.uk}