The Diesel Dilemma: How the EU Ban is Fueling Inflation

Posted: January 27, 2023

RP Weekly Recap | January 20-27

Summary

At three of TotalEnergies’ refineries in France, strikes have already started. Beginning on February 5th, the European Union imposed a ban on the import of Russian petroleum. According to Bloomberg, diesel fuel cargoes are being redirected from their original destinations in Europe to new ones in the United States. Due to weak demand, the EIA has predicted lower prices for both gasoline and diesel this year. As goods are transported using diesel, higher-priced diesel will result in more expensive goods. Thus, the embargo will accelerate an inflation that is already causing governments on both sides of the Atlantic to worry.


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