Okay, so I might just be a bit of a worry wart here and a bit too alarmist but somehow I don’t feel too good about the fact that 10 out of France’s 12 refineries are currently shut down and that crude oil is being blocked at port for delivery. In case you’ve missed out on the latest news over here, there’s a bit of industrial strife going on at the moment, with unions conducting mass protests and strikes against a law reform currently in its last stages.

Stock SAGESSE The authorities and the media are trying to soothe down the concern by reassuring us that France has at least 3 months worth of Strategic reserves on top of the private sector’s own 9 days of stock on hand. According to my own research, the french strategic reserves are at roughly 98.5 days of ordinary usage worth.

But there are a few catches with these facts: 1. the strike is now already in roughly its seventh day which means the strategic reserves become no longer an option but potentially a required reality and 2. these reserves are designed to protect the country from exogenous supply shocks – not internal strife. In other words: they do not consist, in large part, of refined petroleum but mostly of crude oil or distillats.
With the majority of the refineries now shut down, one has to wonder how these reserves are going to be of much use. Add to this the fact that the fuel depots are now also being targeted for industrial radicalisation and you start throwing even more ‘oil on the fire’ (sorry, couldn’t help myself…).

Now, of course, France is not exactly an island so there is still the potential of transporting refined produce from across Europe but that would certainly not be cheap. Add to this the potential for truck drivers throwing in their lot and the whole thing just becomes ridiculous.

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