European Ministers Discuss Oil Price Impact on Transport

European transport ministers met to discuss responses to the continent’s worst energy crisis since the 1970s, but refrained from a EU-wide response to fuel tax relief. Truckers, taxi companies and tour bus companies have claimed that high oil prices are hurting their businesses. Protests have at times shot down surface transport networks in cities throughout Britain, Belgium, the Netherlands and France. Although Europeans have long been accustomed to paying as much as four times what Americans pay at the fuel pump, more and more have reached run out of patience with government inaction. Fuel taxes add as much as 80% retail gasoline prices in Europe, but now Europeans have also been affected by worldwide supply shortages as well as the declining euro, which has lost more than a quarter of its value against the U.S. dollar since its introduction in 1999. Crude oil is primarily priced in American dollars in world markets. However, neither transport ministers there, who want to internalize some of the congestion and environmental costs associated with road transport through fuel taxes, nor finance ministers, whose governments depend heavily on such revenues, can agree to reduce them. Though it is too early to measure, most observers expect public transport patronage to increase as it did in the U.S. when gasoline prices spiked due to similar supply shortages earlier this year.