charges about 22 billion euros to offset inflation, says Bruno Le Maire

The gas price freeze should cost “probably EUR 10 billion over the whole of 2022”, compared to EUR 1.2 billion budgeted so far, the Minister of Economic Affairs said on Monday.

Faced with rising energy prices, the French government plans to spend around €22 billion on measures to support purchasing power, Economy Minister Bruno Le Maire said Monday. The gas price freeze is expected to cost”probably 10 billion euros over the whole of 2022“, against 1.2 billion euros budgeted so far, he explained on RMC/BFM TV.

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cap electricity prices“has already cost”8 billion euros and inflation compensation 4 billion euros‘ the minister explained. †The total bill is more than 20 billion euros solely to protect our compatriots from rising energy prices‘ he concluded.

The rate shield“exposed by the government against rising energy prices”will be expensive“, the Minister of Public Accounts Olivier Dussopt had acknowledged a few minutes earlier. †We can regret that this increases the deficit“, he said on France Bleu Drôme Ardèche. †But if we hadn’t set up this + price shield +, the French electricity bill would have increased by 50% in February, the gas bill by 40%. Yes, it’s public money, yes it’s an expense, but it’s an expense that protects the FrenchOlivier Dussopt argued.

The fear of counter-sanctions

For more than a week and the start of the war in Ukraine, Western sanctions have been raining on Russia: exclusion of banks from the Swift system, ban on flights over certain areas, suspension of Russian media in Europe… From now on Bruno Le Maire fears counter-sanctions from Russia, which could indeed strike a chord: gas and oil supplies to Europe. †It is my responsibility to prepare all scenarios‘ said the Minister of Economic Affairs on Monday. †I am preparing the scenario of a total shutdown, rising prices… There are uncertainties associated with the counter-sanctions that will be decided and of which we know nothing. Wisdom is therefore to prepare scenarios

The European Union is indeed in a delicate position, as it is 40% dependent on Russian gas supplies. If France is less concerned, with less than 20% of its gas coming from Russia, energy promises to become a critical issue in the coming months. Engie’s director-general Catherine MacGregor warned that France could face difficulties in stockpiling gas this summer, ahead of the winter of 2022-2023.

Faced with energy price inflation, the government is ready tofurther” measures to support the purchasing power of households, but if necessary it will be a matter of “focused“, Bruno Le Maire assured. †It won’t be +, whatever the cost +‘ said the Minister of Economic Affairs. †We are not responding to a major geopolitical turning point by paying a check here or there“, he developed following the Russian offensive in Ukraine launched at the end of February, which accentuated the rise in energy prices.

We will give an answer to all the French most affected by the crisis, (…) answers aimed at those who need it mostadded Bruno Le Maire. On Wednesday, President Emmanuel Macron asked Prime Minister Jean Castex to elaborate “a plan for economic and social resilienceto respond to the difficulties arising from the Russian-Ukrainian conflict, in particular the rise in the prices of energy and raw materials.

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All options on the table

European countries are also currently consulting with the United States about the desirability of banning Russian oil imports, in order to deal an additional blow to this economy already barred from banking and commercial exchanges. There is currently no consensus on this option: Germany is against such an embargo on oil, gas and coal. A ban “would threaten social peacein Germany, ecologist Minister of Economy Robert Habeck had warned Friday. †All options are on the table“, nevertheless wanted to insist on Bruno Le Maire.

In France, too, energy prices weigh on the household budget: in some gas stations, the liter of petrol now exceeds the symbolic bar of 2 euros per litre. Faced with these painful purchasing power developments, Bruno Le Maire assured that the state would continue to be present:I see all the worries† The Minister of Economic Affairs, on the other hand, has not specified what form this aid could take, and whether it will again be a “Chequelike the one paid to precarious households in December 2021.

In the long term, Bruno Le Maire considers it necessary toenergy independence from France», in particular the possibility of de-indexing the prices of electricity from those of gas, as is currently the case.

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