TotalEnergies extends French fuel price cap to fight inflation

The French government, in line with other countries in Europe, is stepping up efforts to lower food and transport prices, strong-arming big business to help ease consumer pain. In his remarks on Tuesday, Le Maire also confirmed plans for a windfall tax on companies that run highways.

French Finance Minister Bruno Le Maire welcomed oil giant TotalEnergies' decision on Tuesday to maintain a cap on fuel prices beyond Dec. 31, urging other companies to join the fight against the high cost of living. The French government, in line with other countries in Europe, is stepping up efforts to lower food and transport prices, strong-arming big business to help ease consumer pain.

In his remarks on Tuesday, Le Maire also confirmed plans for a windfall tax on companies that run highways. Le Maire last month reached an agreement with major food retailers and producers to cut prices on 5,000 everyday products and to bring forward annual price negotiations to September rather than next year.

TotalEnergies earlier on Tuesday said that a 1.99 euro per litre cap on fuel prices, which was originally due to expire at the end of the year, will be extended at all its petrol stations in France beyond Dec. 31 and remain in place "as long as prices remain high". "It is good news for all the people who work and for purchasing power. I would like other distributors to join the movement," Le Maire told LCI television.

Energy Minister Agnes Pannier-Runacher was holding talks with petrol station owners on Tuesday, Le Maire added. "The inflation burden must be shared," he said.

French retailer Intermarche was among those represented at the meeting and issued a statement saying its petrol stations will sell fuel at cost price over a Friday and Saturday once a month until the end of the year. TAXING HIGHWAY PROFITS

"I can confirm that we will impose a tax on the extra profits made by highway companies," Le Maire also said. A spokesperson for highway operator Vinci said the group was "surprised" that the minister was speaking of "extra profits" given that the French Transport Regulatory Authority had concluded they were not making excessive profits.

Eiffage's motorway concessions business APRR declined to comment because no details of any tax plan had been provided. Shares in the two groups were unchanged after Le Maire's announcement.

Several European governments, including those of Italy and Britain, have been fighting rising living costs, seeking to force big companies to share the burden with consumers. Italy last month became the latest European country to try to help mortgage borrowers by imposing a windfall tax on bank profits bolstered by rising interest rates.

Several governments across Europe imposed windfall taxes on energy companies last year to rein in excess profits as energy prices soared after Russia's invasion of Ukraine. France is under pressure to bring finances into balance after Fitch cut the country's credit rating to AA- last April on concern over potential political paralysis and social unrest triggered by changes to its pension system.