TotalEnergies Fuel Cap Draws Competition Complaints From French Rivals

French motorists are flocking to TotalEnergies stations to buy discount fuel, but the company’s rivals say the price cap amounts to unfair competition aided by the government.

The cap, set at €1.99 per liter for E10 gasoline and €2.25 per liter for diesel, has been in place intermittently for five months. It sits well below the national average of roughly €2.15 a liter and far under prices of nearly €2.50 in parts of Paris. The move has cost TotalEnergies between €250 million and €300 million so far.

Higher oil prices triggered by the US-Iran war this spring allowed the company to double its first-half profit to €11.2 billion. TotalEnergies introduced the cap as political pressure mounted for a windfall profit tax on energy companies. Prime Minister Sébastien Lecornu in May called on the company to implement “a generous cap.”

Chief executive Patrick Pouyanné has warned the cap will be removed if a special tax is imposed. “There’s nothing forcing us” to keep the cap in place, Pouyanné said recently. “If a tax is introduced, we’ll draw our conclusions and TotalEnergies won’t have any more price caps.”

**Competition complaint lodged**

The FF3C trade association, representing a thousand independent service stations, filed a complaint in mid-July with France’s competition regulator. “There is an upstream player with a dominant position that takes advantage of it to set very aggressive prices that are below market levels,” said Jacques Goisque, head of FF3C. “We can’t sell at a loss.”

Supermarket chains that typically sell gasoline at or near cost to draw customers are also pushing back. Michel-Edouard Leclerc, head of the leading chain E.Leclerc, said “refiners are lining their pockets” while retail distributors cannot compete. “We can’t go any lower than what our prices are today. We don’t have a cent of margin in our filling stations.”

More than a dozen filling stations on the island of Corsica closed over the past weekend. In a statement, the stations said their purchase price “exceeds Total’s retail price by several dozen cents,” and denounced “the state failing to regulate prices,” which they said “allows an integrated group that benefits from considerable upstream margins to dictate, to blackmail, leading to this distortion of competition.”

**Government walking a tightrope**

With a presidential election seven months away and France’s economy worsening, the government is closely monitoring the situation. President Emmanuel Macron called on Wednesday for action on fuel supplies and prices.

Government spokeswoman Maud Bregeon noted that around one in ten filling stations in France lacked at least one fuel, with the vast majority of them being TotalEnergies stations. She said the government would work to ensure sufficient supplies and gain regulatory flexibility on refineries. The goal, she said, is “to push prices down as much as possible, or at the very least to keep their increase under control.”

“Today, the public authorities are quite happy a private company is doing the job, perhaps in their place,” said FF3C’s Goisque.

The latest jump in fuel prices has revived calls for street demonstrations reminiscent of the 2018 “yellow vest” movement, which began over a fuel-tax increase and grew into a broad challenge to President Emmanuel Macron’s economic policies.

**Public image payoff**

While the price cap is costly, it has burnished TotalEnergies’ reputation. The company has frequently faced criticism for the low taxes it pays in France relative to its global profits.