Monday, June 09, 2008

Spanish Truckers Block Border

Spanish Truckers Block Border

Robin Townsend/European Pressphoto Agency

Dozens of trucks stood idle at the La Jonquera border crossing between France and Spain on Monday in Girona, Spain, during a protest against rising fuel costs.

Published: June 10, 2008

MADRID — Gasoline at $4 a gallon? If that was America’s nightmare at the weekend as fuel prices reached a record national average, pity poor Europe, where the price of oil and taxes levied at the pump combine to push prices to about double the United States’ level.

In the latest show of distress, Spanish truckers Monday began a blockade of their country’s border with France, lining up their rigs and slowing them to a crawl to protest the cost of diesel fuel. The strike blocked the highway in both directions in southwestern France. The protest turned ugly when would-be strike-breakers in Spain found their windshields and headlights smashed and their tires slashed.

But the Spanish drivers were not the only ones feeling the pinch. French drivers slowed traffic near Bordeaux to demand lower fuel prices, offering a foretaste of a planned national strike by truckers next Monday. Portuguese drivers blocked roads and in Belgium thousands of labor union members demonstrated in Liege to protest the rising cost of living as a result of fuel costs.

Fuel prices have been far higher in Europe than in the United States for many years, largely as a result of fuel taxes imposed after the oil shock in the 1980s. Taxes account for at least half the price motorists pay, and sometimes more than 70 percent. But the sustained surge in oil prices has left many Europeans bewildered by the relentless increase in the cost of gasoline and diesel bills. Depending on where and how fuel is bought, the price of diesel — widely used in private cars as well as by truckers, fishermen and farmers — can reach the equivalent of almost $9 per gallon.

Across Spain, approximately 70,000 truckers joined the strike Monday, according to Desirée Paseiro, a representative of a truckers’ association that is threatening to paralyze the country unless the government introduces measures to lower their fuel bills.

The strike has alarmed many people, already lining up at gas stations and supermarkets for fear that supplies will be cut. Wholesale food markets such as Mercamadrid stocked up on fish and meat over the weekend so that their stalls would not be left bare. Monday morning, groups of slow-moving truckers blocked the major highways that surround the Spanish capital in a so-called “snail protest” that snarled the traffic. Some food distributors fear their trucks will not be allowed to roll.

“We are the ones who move the merchandise that this country needs to function,” Julio Villascusa, a truckers’ representative, told Cadena Ser radio station on the eve of the strike. “If we don’t have the money to keep buying fuel to offer this public service, well, then this country comes to a halt.”

Spanish truckers say the price of diesel fuel — which varies among European countries — was now 1.30 euros per liter, roughly $7.73 per gallon, compared to 0.95 euros per liter a year ago. At that price, they argue, it costs them far more to buy fuel than they earn from trucking contracts.

The rising European anger may well be matched by the price of oil, according to Jeffrey Currie, the global chief of commodities research at the investment bank Goldman Sachs. At an oil and gas conference in Malaysia on Monday, he suggested oil prices are likely to hit $150 a barrel this summer, surpassing the record of $139.12 set last Friday, Reuters reported.

“I would suggest that the likelihood of that happening sooner has increased tremendously — sometime in the summer,” Mr. Currie was quoted as saying. “Demand for oil is weak but supplies are even weaker.”

Spain has been particularly hard hit as soaring fuel prices coincide with the sharpest economic retreat in around 15 years, but the Spanish strike was only the latest in weeks of protests stretching from Britain to Italy.

The Spanish government has so far offered loans to the industry, composed principally of small businesses, but talks Monday were reported to be making little progress.

Dale Fuchs reported from Madrid and Alan Cowell from Paris.

No comments: