France in a Chokehold: Now Even a Gasoline Shortage Looms

American Thinker 

For the French, everything is coming at once in these difficult weeks. After market turmoil, a debt crisis, and migration chaos, gasoline is now running short at many filling stations. President Macron is touring the Middle East in an attempt to secure relief.

France is heading toward a historic failure in these weeks. In the country with the world’s largest welfare state, lavish pensions, a state-dominated economy, and the fatal illusion surrounding migration, reality has finally become an immovable wall.

At the beginning of the week, another problem emerged for the French: numerous filling stations across the country were experiencing acute shortages of gasoline and diesel.

The figures show what the situation at filling stations actually looks like. On Tuesday morning, more than 1,500 stations nationwide were affected by shortages. In eastern France and the Paris region, the share had already exceeded 23 percent. Particularly troubling is the fact that some affected stations could no longer offer their customers any fuel at all. The supply situation is thus becoming an acute risk to mobility and economic activity.

Against this backdrop, President Emmanuel Macron has embarked on a three-day trip to the Gulf region. Since Monday, his itinerary has included visits to Kuwait, the United Arab Emirates, Bahrain, and Qatar, with the aim of securing short-term commitments for additional oil and diesel supplies. Macron is accompanied by representatives of the energy companies TotalEnergies and Engie. So far, however, no supply contracts have been concluded.

Even though the situation in the Strait of Hormuz has eased in the meantime, it is almost impossible to free up flexible supplies of already-refined fuel from existing delivery contracts. It is therefore unlikely to easily resolve the problem at French filling stations in the short term, particularly since transportation itself would take time.

The perfect storm has gathered over France, and the Europeans’ self-deceptions have collided with reality.

From the end of fossil fuels to sanctions against Russia, from the lies surrounding migration and multiculturalism to an unlimited welfare state, we are witnessing the collapse of the globalist dream.

It appears that the multiple crises are first throwing France into turmoil, shattering the dream of a state-run economy, politically controlled energy flows, and the fragmentation of civil society into cultural sub-identities long envisioned by the Left. Chaos is not a sustainable model of rule. At best, it is the breeding ground for a short-lived and fragile tyranny.

Behind the chaos in France, the sovereign debt crisis continues to smolder, having become a threat to the eurozone. As French cities disappear into the smoke of migrant mobs and aggressive far-left milieus, the crisis has developed from a smoldering fire into a raging blaze.

After a brief period of calm in the bond market, the yield on France’s ten-year government bond rose again on Wednesday morning, approaching the five-percent mark at a dangerous pace. The European Central Bank appears to have erected an intervention firewall at this threshold. Christine Lagarde stands ready with the money-printing press, prepared, if necessary, to purchase bonds from the market and thereby keep interest rates under control.

Can this work in the long run? Bond markets are deep and have enormous capacity. At best, the printing press can deliver a short-term effect, one that must ultimately lead to massive inflation.

No, France must solve its debt problem through austerity and a growth-oriented policy -- the era of the socialist feel-good paradise is long over. Marine Le Pen’s announcement that, if elected president, she would shift part of the budgetary burden onto Germany through the CO2 mechanism and a change in membership contributions is dishonest. It signals a rupture in the partnership between Europe’s right-wing parties before that partnership has even had a chance to take hold.

There is absolutely no doubt that investors no longer trust the French situation. No one understands how a budget deficit of 5.7 percent can be allowed to persist without any meaningful political reaction.

The financing of lavish pensions and the world’s largest welfare system, alongside an official government spending ratio of 57 percent, will also force investors to reassess the situation in light of the chaos in the country.

The bottom line: If everything remains as it is -- which seems all too likely -- banks, pension funds, insurers, and hedge funds could send France’s credit rating crashing like a financial guillotine. Stock markets are already reacting to rising interest rates and the persistent selling pressure on French government bonds, and they are moving into a downturn. If the ECB fails to bring interest rates under control, the higher cost of borrowing will gradually feed through the economy’s value chains and financial processes in credit markets: investment and consumer loans will become more expensive. France’s anemic economy would be dealt another heavy blow.

They are already acting in a headlong, almost panicked fashion. This would trigger a systemic heart attack and usher in the end of the euro system. The EU’s second-largest pillar could not be kept standing for more than a few weeks, neither through financial transfers from other member states nor through the ECB’s credit pump.

In the EU’s capitals, they sense that a decisive phase in the markets may have begun. Fuel reserves are being released. Desperately, they cling to the illusion of victory in the Donbas, all the while keeping their eyes on Russia’s energy and resource reserves and on regime change in the Kremlin. An extremely dangerous situation is taking shape, as politicians in panic mode will no longer act rationally.