A Continent Squeezed

Diesel prices in Europe have hit record highs, driven by conflict in the Middle East and an outage at Russian refineries that have squeezed the supply of refined fuel. Europe relies on diesel for road transport more than any other major economy, so the price spike is hitting hard. By mid-September, drivers filling a typical car were paying about €30 more per tank, and a German truck was spending an extra €236 a week compared with before the crisis. Across the continent, higher fuel costs for road transport are running about €270 million a day, most of it from diesel.

This matters beyond the pump because higher transport costs tend to work their way into the price of goods and services. Analysts note that about 30% of Europe's diesel car fleet is more than 15 years old, and the money lost to high prices since the crisis began is roughly equivalent to what it would cost to offer a €2,000 scrappage payment to retire all of those older diesel cars.

Proposed responses include short-term steps like lower motorway speed limits and cutting fuel demand through eco-driving and car sharing, alongside longer-term pushes to keep Europe's 2030 vehicle emissions targets intact, stick with the 2035 end date for new gas and diesel car and van sales, and use windfall profits from oil companies to cushion households from future fuel shocks. For homeowners, the story is a reminder that dependence on oil-based fuels carries a cost, one that electric transport and other alternatives are meant to reduce over time.