The European Commission announced this Wednesday that it will work closely with the continent’s refineries to increase fuel production and contain the loss of industrial capacity in the European Union. At the same time, it will analyze different options to ease pressure on diesel prices and other fuels, in the midst of the energy crisis that could last until 2027.
"We will work to increase the production of European refineries. The sector has put forward some proposals that we must evaluate, because, in the end, we need to reduce fuel prices. This is very important in the short term to ease the pressure on our companies and citizens," said the European Commissioner for Energy, Dan Jorgensen, at a press conference at the end of the meeting with representatives of the industry alongside the Community Defense official, Andrius Kubilius.
After the meeting, in which representatives of NATO also took part, the Danish politician detailed that the closure of nearly 25% of European refineries in the last two decades has cut the EU's fuel production capacity by around 10%. In his view, it is essential to reverse this dynamic in the face of growing supply difficulties and the rise in the cost of oil derivatives linked to the conflict in the Middle East.
"This crisis is a wake-up call. We have to counter this trend and make sure that we have sufficient and flexible refining capacity in Europe, both now and in the future," the commissioner warned, who stressed that "this is not only a matter of economic competitiveness," but also of "security." "We know all too well that dependencies are dangerous," he added.
In this regard, he recalled that the International Energy Agency (IEA) anticipates that the global diesel market will continue to be under strong pressure "well into 2027," which will keep prices at high levels, although for now Brussels does not foresee problems of physical availability of fuels.
"We know that this winter will be difficult. It will be difficult for our citizens and for our economy in general," Jorgensen acknowledged, who emphasized that ensuring supply is not enough if households and companies cannot cope with the bill.
The Community Executive has advanced that it will continue technical contacts to analyze in detail the sector’s proposals aimed at squeezing the maximum capacity out of the facilities already operating, with the intention of bringing the industry together again at the beginning of next year and reviewing the progress.
In this context, and questioned about the initiative of French President Emmanuel Macron to relax the technical specifications of fuels to increase production, Jorgensen has indicated that Brussels is evaluating the different alternatives and that it does not rule out studying a "temporary" and "specific" relaxation of certain requirements, provided that the measure "really works" and does not cause "other problems".
Adapting refineries to the energy transition
Despite the emphasis on maintaining European production, the commissioner has stressed that any action must be consistent with the gradual abandonment of fossil fuels. For this reason, the Commission will work with the companies on a shared roadmap that will make it possible to strengthen the production of biofuels and synthetic fuels.
"We know that right now we depend a lot on refineries and that they are also making a lot of money, which is good, because they are providing us with important services. But, when this crisis ends, there will be a global oversupply of what they currently produce. That is why we have to make sure to take advantage of these months and years in which there is money in the sector and in which it is helping us solve important problems to also drive the transition," he insisted.
More fuel for military needs
For his part, the European Commissioner for Defence, Andrius Kubilius, has called for the EU to have the capacity to quickly increase fuel production in the event of armed conflict, as well as to ensure sufficient reserves and strengthen the necessary infrastructure to transport them to the areas where they are needed.
"Without traditional fossil fuels, defense will also not be possible during the next few years," Kubilius warned, who recalled that, according to the NATO force model, the Alliance must be able to deploy and sustain 100,000 military personnel during the first ten days of a crisis, which implies having large volumes of fuel.
The community official has specified that military needs represent around 8% of total consumption in peacetime, according to available estimates, although he has pointed out that this share could increase significantly in a war scenario.
"We have to create a system that guarantees us that, during a war crisis, we will have the capacity to increase production very quickly and have sufficient reserves for an emergency situation," he stressed.
Among the priorities indicated, Kubilius has focused on the protection of strategic infrastructures and on the option of expanding the Central Europe pipeline network, built during the Cold War, in order to ensure that fuel can also reach the countries of the east of the continent.