Spanish Truckers Block Border
Protesting Cost of Diesel Fuel

DALE FUCHS and ALAN COWELL / New York Times 10jun2008

MADRID — Spanish truck drivers began a blockade of their country’s border with France on Monday, lining up their rigs and slowing them to a crawl to protest the cost of diesel fuel.

The strike blocked the highway in both directions in southwestern France. But the Spanish drivers were not the only ones feeling the price pinch. French drivers slowed traffic near Bordeaux to demand lower fuel prices, offering a foretaste of a national strike planned by French truckers next Monday. Portuguese drivers blocked roads, and in Liège, Belgium, thousands of labor union members demonstrated to protest the rising cost of living as a result of higher fuel costs.

Fuel prices have been far higher in Europe than in the United States for many years, largely as a result of fuel taxes. Taxes account for at least half the price that motorists pay and sometimes more than 70 percent.

But the sustained surge in oil prices has left many Europeans bewildered by the relentless increase in the cost of fuel. Depending on where and how it is bought, the price of diesel — widely used in private cars as well as by truckers, fishermen and farmers — can reach the equivalent of almost $9 per gallon.

Across Spain, about 70,000 truckers joined the strike Monday, according to Desirée Paseiro, a representative of a truckers’ association that is threatening to paralyze the country unless the government introduces measures to lower fuel bills.

The strike has alarmed many people, who already have begun lining up at gas stations and supermarkets for fear that supplies will be cut. Wholesale food markets like Mercamadrid stocked up on fish and meat over the weekend so their stalls would not be left bare.

On Monday morning, groups of slow-moving trucks blocked the major highways that surround Madrid in a so-called snail protest that snarled traffic. Some food distributors fear that their trucks will not be allowed to roll.

“We are the ones who move the merchandise that this country needs to function,” Julio Villascusa, a truckers’ representative, told the Cadena Ser radio station on the eve of the strike. “If we don’t have the money to keep buying fuel to offer this public service, well, then, this country comes to a halt.”

Spanish truckers say the price of diesel, which varies among European countries, was the equivalent of $7.73 per gallon, compared with $5.58 per gallon a year ago. At that price, they argue, it costs them more to buy fuel than they earn from trucking contracts.

Prices at the pump could continue to climb, according to Jeffrey Currie, the global chief of commodities research at Goldman Sachs. At an oil and gas conference in Malaysia on Monday, he said that oil prices were likely to hit $150 a barrel this summer, surpassing the record of $139.12 set last Friday, Reuters reported.

Spain has been particularly hard hit as soaring fuel prices coincide with the sharpest economic retreat in 15 years. The Spanish government has so far offered loans to the industry, composed principally of small businesses.

Dale Fuchs reported from Madrid, and Alan Cowell from Paris.

Dale Fuchs reported from Madrid, and Alan Cowell from Paris.

source: 11jun2008

Fuel Cost Protests Go Global

Governments Pressed to Act

DAVID S SANDS / Washington Times 10jun2008

The problem at the pump is fast becoming a crisis at the polls as governments around the world face rising popular unrest and violence because of record-high energy prices.

Portuguese fishermen, Indian civil servants and Bolivian construction workers are among the interest groups who have taken to the streets in recent weeks in mass protests over rising fuel costs.

In Tunisia, the government expressed "regret" over the death Friday of a protester shot by security forces during a demonstration in the town of Redeyef, in the heart of the country's mining region, but vowed to take tough action against further unrest.

"We won't tolerate any use of violence," Justice and Human Rights Minister Bechir Tekkari told reporters.

The political tensions are affecting rich and poor countries alike, with popular protests reported in Europe, Latin America, Africa and across much of Asia.

New conservative South Korean President Lee Myung-bak has seen his political honeymoon cut short in part because of sharp criticism of his handling of the energy crisis. A major street protest is planned for Tuesday, and the country's biggest truckers union authorized a strike over record diesel prices.

Spanish and French fishermen clashed last week with riot police outside the European Union's headquarters complex in Brussels. At least two cars were overturned in the clashes, and police used water cannons to control the crowd.

In Spain, a growing number of gas stations in Madrid and other regions reported Monday they ran out of fuel, the result of a lengthy strike by truckers protesting higher fuel costs.

In Bolivia and Chile, leftist leaders face similar political headaches, as truck and taxi drivers blockade roads and demand higher government subsidies to offset the higher gas prices.

Populist Bolivian President Evo Morales has stood firm so far against the street protests, which have blocked major highways in the country's east, west and south. Unhappy construction workers last week drove dump trucks, backhoes and other heavy machinery into the middle of the eastern town of Santa Cruz de la Sierra.

The fuel-price protests closely track a spate of food-price riots that swept the world in the spring, producing a string of deadly clashes and causing at least one government - Haiti - to fall. In both the food and fuel cases, import-dependent governments have infuriated voters when they tried to cut expensive consumer subsidies as food and fuel prices soared.

Economists say the fuel-price rises could prove even more politically toxic, as higher energy prices translate directly into higher prices for food and any other goods that are shipped large distances.

"The explosion in global transport costs has effectively offset all the trade liberalization of the last three decades," said analysts Jeff Rubin and Benjamin Tal of the Canadian investment banking firm CIBC World Markets Inc.

The fuel unrest has been particularly marked in a number of fast-growing Asian markets that are heavily dependent on foreign oil and gas.

India has been particularly hard-hit, with opposition parties joining with civil servants and public-transport officers in street demonstrations against the government. The Indian government last week allowed gas prices and diesel prices to rise because the cost of subsidizing fuel had become too burdensome.

In Kashmir, government employees took the lead in protesting recent price rises in diesel fuel and cooking oil, while private transport operators staged a four-day strike.

The soaring value of oil has produced problems of a different kind for energy exporters.

Brazilian Defense Minister Nelson Jobim told lawmakers last week the country plans to acquire 50 new ships and build a $600 million nuclear-powered submarine to protect valuable offshore oil fields along the country's southeast coast, a reflection of the increased value of the oil deposits there.

"We have to make it clear that defense is part of the national agenda," Mr. Jobim said.

This article was based in part on wire service reports.

source: 11jun2008