Diesel is scarce in Europe. They notify you from Repsol (who have more than 3,500 service stations in our country). And their ads are not flattering for consumers. At the moment, diesel is already very close to its historical highs. And everything indicates that we can settle if the situation does not get worse.


Bad news keeps coming for owners of diesel vehicles. A fuel that in Europe represents 42.8% of the cars that are used but that in Spain rises to 57.9%. Lithuania, where 69.2% are diesel vehicles, is the country with the most diesel-powered cars.

The last one is sent by Repsol, a company that is beginning to warn of the lack of this fuel in Europe. The problem is a combination of circumstances where Russia, France and the price of gas put their grain of sand so that the supply of diesel may be insufficient and, therefore, prices continue to rise.

a pressure cooker

Get diesel in Europe is, every day, more complicated. First it was the veto on Russian oil. A decision by the European Union that has caused the need to replace one out of every four barrels that were bought on the market. 25% of the offer which, in total, moved an invoice of 48,000 million euros and 75,000 million euros if derivative products are taken into account. There are 4.5 million barrels per day less in the market.

To this is added that the weight of the diesel arrived from Russia was even greater. Diesel is a refined product that was already processed and Europe, when looking for a possible substitute, has found products of poorer quality and higher refining costs, which has raised its price.

During the coronavirus pandemic, some refineries were closed due to their high prices. Today, transportation has picked up but, with Russia out of the picture, barrels available they are less. A situation that has made the refineries that were still alive in Europe have become a real gold mine.

In this context, the strike of the French refineries is added. The social conflict that has left us striking images of rationing and even violence, has caused a significant fuel shortage in the country. But, in addition, it is also putting pressure on the rest of Europe, with imports that the market does not usually foresee, while the country deals with the vast majority of its refineries closed.

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And complete the picture gas price. Its rise has been such that “taking into account the high prices of natural gas that we are seeing in Europe and in other parts of the world – all countries depend on imports of LNG (liquefied natural gas) – diesel, initially, could be chosen to replace gas”, adds Josu Jon Imaz, CEO of Repsol, in words reported by El Español.

Imaz’s words are backed by strategies such as those of Volkswagen, a group that was considering transferring part of its production to Western European countries, such as Portugal or Spain. To this must be added the need to feed the diesel-based heaters.

However, the situation is paradoxical because the european sourcing of gas, with its reserves full in the face of a complicated winter, has caused the price of Natural Gas to plummet. Even this week the price of the TTF has fallen below €100/MWh, a situation that has not been experienced since June.

“There is room to see higher diesel prices”

The words of Josu Jon Imaz have been eloquent. With diesel more expensive than gasoline 98 and prices beginning to approach their all-time high, Repsol’s CEO has announced that this will be the new normal for the coming months and that we can still pay higher prices at service stations.

From Repsol they point out that the previous cases will cause this increase in price but also that the profit margin in refining will be greater. “I don’t have a crystal ball. In case of continuing, unfortunately, in social, economic and political terms, with the current geopolitical tensions in Europe, it seems to me that these very open diesel cracks are going to stay for the next few months, ”says Voz Pópuli.

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These cracks that Imaz referred to in the previous statements, are the profit margins per barrel. In Bloomberg they point out that this profit has shot up to $26 per barrel in October and the CEO of Repsol already pointed out that they do not expect this figure to fall below 15 dollars in the coming months.

They are extraordinary figures. Between May and June, Repsol already multiplied its profit margin by 15 compared to the same period of the previous year. But it’s not the only case. For example, Galp achieved record data in the last three months, going from seven to 13 dollars in profit margin per barrel. Shell achieved in just three months a “positive impact of between 800 and 1,200 million dollars” in its accounts. BP doubled its profits and Exxon Mobile made 4.4 billion profits in the second quarter of the year alone.

Photo | Repsol


The news

The shortage of diesel throughout Europe is already alarming: drivers will pay for the broken dishes

was originally published in

Xataka

by Alberto de la Torre.

Source: www.xataka.com

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Tarun Kumar

Tarun Kumar has worked in the News sector for 05 years and is currently the Owner and Editor of Then24. He reside in Delhi, India with his Family.

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