A strike paralyzing France’s oil refineries is developing into a national crisis, days after a state order this Tuesday commanding an end to the over two-week long work stoppage. Five of seven French refineries were offline or affected by the strike as of Thursday. Nearly one-third of the country’s gas stations have faced difficulties resupplying or have exhausted their stocks — a result of cuts in distribution and panic buying in some areas. First concentrated in gas stations in the northern regions of France, the shortages have since spread, disrupting commuting motorists in growing swaths of the country as the state dips into strategic reserves to bolster energy flows.
The strike movement was launched on September 27 by the Confédération Générale du Travail (CGT), seeking to strengthen employees bargaining hands in the lead-up to annual salary negotiations originally scheduled for mid-November. Primarily involving refinery specialists at oil processing sites, the stoppages at their peak brought six refinery sites to a halt: four facilities owned by the French oil major TotalEnergies, and two locations controlled by Esso, Exxon-Mobil’s subsidiary.
The strikes pose a major problem for Emmanuel Macron’s government, on edge over any new disturbances to an already strained energy market and cautiously watching any runaway demands spurred on by the rising cost of living. In reaction to the government’s contentious requestion order, which will see striking employees summoned by prefects to resume work, the CGT is looking to extend the strike movement to the entirety of the energy sector and beyond. At the behest of the CGT and three other unions, a cross-sectoral strike is scheduled for Tuesday, October 18.
At TotalEnergies, striking workers are seeking a 10 percent increase in wages. As the CGT claims, the raise would allow workers to cushion the blow of the rising cost of living and increase employees’ share of the historic profit margins enjoyed by the energy corporations. Inflation in France slowed slightly in September to a 5.6 percent annual rate, according to the public economic forecaster INSEE, although supermarket prices have risen more sharply, reaching nearly 10 percent. In the first two quarters of this year, ExxonMobile raked in upward of €18.4 billion in global profits, followed by TotalEnergies at €10.9 billion.
This Monday the French Democratic Confederation of Labour (CFDT) and French Confederation of Management – General Confederation of Executives (CFE-CGC) unions — not on strike, but representing a majority of employees at both TotalEnergies and Esso — agreed to a salary agreement with Esso management, settling on a 6.5 percent salary hike and an one-off €3,000 profit-sharing bonus in 2023. Striking workers at the American energy company had been demanding an increase at 7.5 percent. The first requisitions entered into effect on Wednesday, with state orders being sent to employees at Esso’s Gravenchon–Port Jérôme refinery site in Normandy. On Thursday, workers at the Esso site near Marseille voted to call off the strike.
Management at TotalEnergies has labeled the work stoppages as a nonstarter for salary negotiations, but the company received union delegates for late-night negotiations on Wednesday and Thursday in a move toward deescalation. In exchange for an end to the strike action and boasting of the 3.5 percent increase already proffered in 2022, Total appeared to offer on October 13 an exceptional bonus amounting to one-month of wages and a salary hike of 6 percent in 2023 — up from the company’s original opening position was for a 5 percent increase.
“It’s now clear that the current management is no longer interested in negotiating with the trade unions,” the CGT’s antenna at TotalEnergies announced in a press release on Thursday. “TotalEnergies and the complicit government will no doubt prefer to requisition the company’s employees rather than accept a dialogue with them. There can be no doubt that the response will match this unacceptable attack on the right to strike.”
Talks resumed over Thursday night, with the CFDT and CFE-CGC reaching an agreement with management on Friday for a 7.5 percent wage hike. Judging TotalEnergies’ offer to again be insufficient, CGT negotiators walked out of the talks in the early hours of the morning on Friday, vowing to continue the strike movement.
Prime Minister Élisabeth Borne’s “back-to-work” order has Macron’s government backpedaling from its initial attempt to downplay the strikes. As recently as last week, with news of lines winding out of gas stations, the French president claimed that the conflict was a private issue between companies and their employees.
The government’s announcement of the requisition orders “has demoralized nobody,” says Eric Sellini, chief CGT union delegate at TotalEnergies. “They risk even reinforcing the movement and seeing it expand to other professions. From the CGT’s perspective, infringing on the right to strike is unacceptable. The government risks creating a snowball effect.”
Macronist surrogates are hoping to drive a wedge between the striking workers and the motorists and businesses disrupted by long gas station lines and upended commutes. “It’s mostly not Total that is being penalized,” Aurore Bergé, caucus leader of Macron’s party in the National Assembly, told BFMTV on Sunday. “It’s the France that works… that wakes up early to do the morning circuit of gas stations and to just be able to have the right to work.”
The requisition orders have the government and the unions entering relatively unexplored legal territory. French law permits the state to mobilize matériel or individuals in the case of public health or national security crises and to allow a minimum-functioning of public services, a recourse justified in this case by the fact that the refineries provide supplies needed to for key services like ambulances, firefighters, or commuting hospital staff.
While the CGT confirms that some supplies should be provided for critical sectors, the union plans to oppose in court any administrative order designed to impose the full functioning of refineries that go beyond that mandate. Workers who refuse to comply with the summons can face fines of up to €10,000 and six months’ imprisonment.
Not party to the strike movement, the CFDT — France’s conventionally “reformist” union — has nonetheless called out the requestion orders as a dangerous escalation on the government’s behalf. “It’s the sign of a failure of social dialogue to arrive at extremities like this,” says Geoffrey Caillon, CFDT representative at TotalEnergies. “Forcefully mobilizing workers is not something that is going to unfreeze the situation and permit a return to negotiations and discussions.”
Before the cross-sectoral strikes this coming Tuesday, October 18, numerous trade unionists and associations are joining this Sunday’s march in Paris against governmental inaction on the rising cost of living. Scheduled for several weeks, the march was called by the Nouvelle Union Populaire Écologique et Sociale (NUPES), the alliance of left-wing parties in parliament. The NUPES alliance is hoping that the strikes can serve as a catalyst for France’s social movements and the emergence of a broad-based front against Macron’s government.
Yellow Vest Effect?
It’s too early to tell which way public opinion will fall, and how effective government efforts to paint recalcitrant strikers as privileged employees leveraging their strategic role in the economy to enforce their demands. But if the striking unions can build bridges with other segments of the workforce, the debate will zero in on the skyrocketing profits enjoyed by companies which have found themselves in a position to extract significant rents thanks to rising prices.
While the phenomenon is not exclusive to the energy sector, the elevated profit margins enjoyed by energy company are particularly representative of the market distortions that have accompanied rising inflation. Riding high on 2022’s promising results, TotalEnergies plans to distribute to shareholders €2.6 billion of dividends, at €1 per share.
Statistics like these have fed calls in recent months for windfall taxation on corporate “superprofits” — another form of public requisitioning that Macron’s government has eschewed in favor of subsidizing an (albeit elevated) price cap at the pump, or per-liter discounts on gasoline purchases. TotalEnergies vaunts its own self-imposed discount of 20 cents per liter as a case of good corporate governance. The EU’s minimum levies on windfall energy sector profits were amended into the 2023 budget bill now being debated before France’s parliament.
‘“Super profits’ have nothing to do with business strategy or investments, they’re related to external phenomena,” says Vincent Drezet, spokesman for ATTAC, the alter-globalist French NGO that advocates for an overhaul of the corporate tax regime. “[EU’s windfall levies] have not been a block on member states going further. A number of states that have instituted their own national mechanisms — Portugal, most recently. France has been limiting itself to the minimal route.”
Offensive strikes for wage hikes are another way of distributing runaway corporate profits. Betting that most French people won’t see it that way, government sources have slipped to the press that they don’t fear a “Yellow Vest effect” in which the movement spreads beyond its initial demands. They hope to harangue workers with the insistence that they should show “responsibility.” The tenor of the next few weeks will reveal if it was the correct calculation.