France’s Trade Deficit Widens On Surging Oil Imports

France’s trade deficit jumped in July compared to June as the country’s crude oil imports soared after strikes and riots had blocked French oil refineries in May and June, the French customs office said on Wednesday.

The total French trade deficit in July jumped to the largest since April, to US$5.06 billion (4.5 billion euro) in July from US$3.94 billion (3.5 billion euro) in June.

In just one month, in July, France’s hydrocarbons trade deficit rose by US$1.24 billion (1.1 billion euro) to stand at US$2.5 billion (2.22 billion euro).

The crude imports surged to supply French refineries which were hit hard by protests that started in May. Back then, hundreds of petrol stations were forced to close down and nearly a thousand more faced shortages as union protests blocked oil refineries over controversial labor reforms, clashing with riot police in some locations across the country.

Unions blocked deliveries from five out of eight refineries in France to protest against labor laws passed earlier in May. The labor laws make it easier for employers to hire and fire staff and reduce overtime compensation.

Workers considered the bill unfavorable and demanded that it be withdrawn. They also argued that the laws were pushed through without a public debate and without a vote in the Parliament.

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The protests also led French Total SA (NYSE:TOT) to say that it would reconsider its investment plans in France.

Chief executive Patrick Pouyanne, speaking outside the annual shareholders meeting in France, said that Total would “seriously reconsider” its French investments in the wake of the union-led labor protests that have forced Total to shut down several refineries. The CEO’s comments came a few days after he had said that Total was interested in French shale production.

“I am ready to finance exploration because I think the debate has started on uncertain grounds. If I’m allowed to do so, it would be either to recognize a lack of potential so we can stop fighting for nothing; or on the contrary, if we find the right amount of resources the country will decide what to do with it,” Pouyanne told a Parliament committee, commenting on France’s shale prospects.

By Tsvetana Paraskova for Oilprice.com

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