Arab Today, arab today french oil tax to hit refiners add to closures
Last Updated : GMT 09:50:52
Arab Today, arab today
Arab Today, arab today

French oil tax to hit refiners, add to closures

Arab Today, arab today

Arab Today, arab today French oil tax to hit refiners, add to closures

Paris - Arabstoday

France\'s plan for a one-off tax on oil inventories will further damage the competitiveness of the beleaguered refining industry, discourage investments in unprofitable refineries and lead to more plant closures. France announced last week it would impose the tax on the oil sector to raise some 550 million euros ($693 million) to help it meet its budget deficit targets as economic growth grinds to a halt. The new Socialist government said the tax would affect oil majors such as Total, whose margins had swelled with rising oil prices. But it is designed to hit all owners of crude and fuel stocks in mainland France — from refiners to supermarket petrol stations and traders. French refiners, in particular, have been struggling for years due to poor margins, weak demand and a surplus of gasoline capacity, analysts said, while the traditional market for French gasoline exports, the United States, has dried up. \"Refineries in France have lost 2 billion euros over the last three years,\" Jean-Louis Schilansky, head of France\'s oil industry body UFIP, said. \"This is a globalized system. Petrol can be refined in Africa and sold in Europe or North America,\" he added. \"We\'re not going to do blackmail or carry out threats. But this is very detrimental,\" he said. Roy Jordan, an oil analyst with Facts Global Energy in London, said the tax comes at a bad time for the industry. \"This is against a background of capacity surplus in Europe,\" Jordan said. \"We already had capacity closure in France for this very reason, and if this is something that continues, we could see more closures,\" he added. NEED CASH Total, Europe\'s biggest oil refiner, still owns five refineries in France after it shut its Dunkirk refinery in the north in 2010. Its chief executive, Christophe de Margerie, said over the weekend the tax would cost Total 140 million to 160 million euros. \"What is bothering us really is that the refining sector ... is a loss-making sector, and it\'s always a nuisance when you overtax a sector which is not doing well in the first place,\" he said on the sidelines of a conference in Aix-en-Provence. ExxonMobil owns two French refineries, one in Normandy and one near Marseille, and Dutch group LyondellBasell and England-based Ineos each own one. \"They (refiners) have no incentives to stay,\" said an oil service analyst with French brokerage Natixis, who declined to be identified. \"When the French government raises taxes on the wealthy, at least the rich have assets. Here (for refiners), the assets aren\'t even worth anything,\" he said. The future of the Petit Couronne plant of now insolvent Petroplus is still uncertain. Yvon Scornet, head of the CGT union at Petit Couronne, said the one-off tax, which would cost the refinery 8 million euros, was likely to become permanent once accepted by the sector and might scare off potential bidders for the ailing plant. \"What we are asking for is a tax on imported fuel products like they are doing in Italy and mulling in Britain,\" he added. Italy is readying legislation to limit petrol imports from outside the European Union as it moves to help hard-pressed domestic refiners. France\'s petroleum industry body said the new tax added a burden on the competitiveness of the sector. The tax, which will amount to 4 percent of the value of average crude and fuel stocks owned in the last three months of 2011, was devised by the government with Total\'s hefty 2011 net profit of 12.3 billion euros in mind, analysts said. The French oil distribution industry, however, had an overall net margin of about 500 million euros in 2011, according to UFIP estimates, equivalent to the amount to be levied by the government this year. \"If they need cash, they should allow more oil exploration. There was an opportunity with Melrose off the coast of Marseille. They refused it, even though these are activities you can tax very heavily,\" the Natixis analyst said. UNPROFITABLE BUT ALLURING Analysts said it would be premature to write off French refining sites, however, especially if the tax remains a one-off. A sharp fall in oil prices in June provided a brief boost to refiners, whose margins surged to their highest levels since late 2008, even though this is likely to be short-lived, Jordan said, as oil demand remains depressed. Some refineries in strategic locations on the Mediterranean or the English Channel also could become targets for Asian or Russian oil companies that want access to European markets for their unrefined products, regardless of refining profitability. Petrochina has formed a joint venture with Ineos to supply crude to its Lavera refinery in southern France and market its products. Russian oil trading house Gunvor, which bought its first refineries in Europe this year, also said it was interested in expanding further abroad. \"They are doing this for strategic reasons because they want to become international players, and they would be satisfied with low return levels that wouldn\'t satisfy an integrated oil company,\" Facts Global Energy\'s Jordan said.

Name *

E-mail *

Comment Title*

Comment *

: Characters Left

Mandatory *

Terms of use

Publishing Terms: Not to offend the author, or to persons or sanctities or attacking religions or divine self. And stay away from sectarian and racial incitement and insults.

I agree with the Terms of Use

Security Code*

Arab Today, arab today french oil tax to hit refiners add to closures Arab Today, arab today french oil tax to hit refiners add to closures

 



Arab Today, arab today
Arab Today, arab today Mohamed Bahari prepares new collection for spring 2017

GMT 06:15 2017 Monday ,27 February

Mohamed Bahari prepares new collection for spring 2017
Arab Today, arab today 17.4 million tourists visit UAE in 2016

GMT 00:47 2017 Monday ,27 February

17.4 million tourists visit UAE in 2016
Arab Today, arab today Sheds light on major steps in 12-year career

GMT 06:07 2017 Monday ,27 February

Sheds light on major steps in 12-year career
Arab Today, arab today UN envoy sets out framework

GMT 07:25 2017 Monday ,27 February

UN envoy sets out framework
Arab Today, arab today Ayat Abaza says state TV presented major stars

GMT 03:52 2017 Sunday ,26 February

Ayat Abaza says state TV presented major stars

GMT 05:33 2017 Thursday ,23 February

Oil slips but close to multi-week high

GMT 17:44 2017 Wednesday ,22 February

Gasoline 98 octane price surges LL100

GMT 15:37 2017 Wednesday ,22 February

Nakilat Posts QR 955 Million Profit in 2016

GMT 15:32 2017 Wednesday ,22 February

Laffan Refinery 2 Cost QR 3 Billion

GMT 15:31 2017 Wednesday ,22 February

Oil up 2% as OPEC chief sees higher compliance with cuts

GMT 07:00 2017 Wednesday ,22 February

Oil prices rise on high OPEC compliance with output cuts
View News in Arabic - Business: نفط وبتروكيماويات
Arab Today, arab today
Arab Today, arab today
Arab Today, arab today Reading therapy relieves mental disorders

GMT 15:39 2017 Friday ,24 February

Reading therapy relieves mental disorders
Arab Today, arab today UK appoints 1st Scotland Yard chief in 188 years

GMT 05:14 2017 Thursday ,23 February

UK appoints 1st Scotland Yard chief in 188 years
Arab Today, arab today Penguins in the age of dinos

GMT 11:44 2017 Saturday ,25 February

Penguins in the age of dinos
Arab Today, arab today Pluto's unruly moons

GMT 06:31 2015 Thursday ,04 June

Pluto's unruly moons
Arab Today, arab today 'Constructive' Vauxhall talk with union

GMT 08:54 2017 Saturday ,25 February

'Constructive' Vauxhall talk with union
Arab Today, arab today Tesla back into red but revenue grows

GMT 07:27 2017 Thursday ,23 February

Tesla back into red but revenue grows
Arab Today, arab today Reasons for the delay 'On the Stairs of Servants'

GMT 06:42 2017 Saturday ,25 February

Reasons for the delay 'On the Stairs of Servants'
Arab Today, arab today Ex-yoga missionary unleashes rage

GMT 12:16 2017 Thursday ,23 February

Ex-yoga missionary unleashes rage

GMT 07:23 2017 Friday ,24 February

Ola Ghanem hopes to work with M.Ramadan

GMT 12:35 2017 Tuesday ,21 February

63-Year-Old Woman Delivers Baby

GMT 18:23 2017 Friday ,24 February

Fadi explains secrets of  Nancy Ajram's newlook

GMT 10:28 2017 Wednesday ,22 February

Milan laughs while Rome cries

GMT 19:45 2017 Monday ,20 February

Sarah Belamesh designs antiques of "ceramic"

GMT 10:51 2017 Saturday ,25 February

Pigs with edited genes show resistance

GMT 14:04 2017 Friday ,24 February

Messi visit will contribute in tourism

GMT 13:12 2015 Saturday ,09 May

Sheikh Sultan opens Sharjah Centre

GMT 22:42 2017 Thursday ,23 February

Nasima Gamei revives heritage in jewelries
Arab Today, arab today
Arab Today, arab today
 
 Arab Today Facebook,arab today facebook  Arab Today Twitter,arab today twitter Arab Today Rss,arab today rss  Arab Today Youtube,arab today youtube  Arab Today Youtube,arab today youtube
arabstoday arabstoday arabstoday arabstoday
arabstoday arabstoday arabstoday
arabstoday
بناية النخيل - رأس النبع _ خلف السفارة الفرنسية _بيروت - لبنان
arabstoday, Arabstoday, Arabstoday