French retail chief warns of six-month energy crisis as fuel prices stay high

Michel-Edouard Leclerc, president of the E.Leclerc retail group, has warned that Europe faces “at least six months, maybe until next winter, of energy crisis ahead,” while assuring consumers that “the price of the shopping basket in the coming weeks will not increase.”

Leclerc said fuel prices are unlikely to “fall anytime soon,” adding that motorists will continue to feel the impact of elevated energy costs, BFM reports.

“It won’t go down anytime soon, and if it does go down — which I hope — I want it to be meaningful, because for now it is a yo-yo effect,” he said.

Despite the energy outlook, he sought to reassure households that retail prices would remain stable in the short term. “The price of the shopping basket will not increase in the coming weeks,” he said.

Leclerc also highlighted ongoing tensions between large retailers and food industry suppliers, noting that negotiations held until the end of February had brought major companies back to the table on pricing. “Normally, all inflation forecasts are below 1%,” he said in an interview with Europe 1. The government, however, has revised its inflation forecast for the year to 1.9%, up from 1.3%.

“However, if the energy crisis affects all our suppliers line by line in their accounts, there will be inflation of double or even triple that level in the end,” he warned.

The government has called on both retailers and manufacturers to “return to the negotiating table.”

Food producers, however, have warned of rising costs. French dairy group Lactalis — which owns brands such as Président, Lactel and Galbani — said it would need to “pass on” the impact of the Middle East conflict to consumer prices. CEO Emmanuel Besnier said hostilities since late February have had “a significant impact on costs, both in transport and packaging.”

Lactalis, along with other industry players, is calling for the reopening of commercial negotiations with retailers to share these unexpected costs. Retailers, however, have so far resisted such a move.

In this context, Agriculture Minister Annie Genevard urged both sides to “return to the table” to discuss how to distribute additional costs linked to inflation driven by the Middle East conflict, without necessarily reopening “difficult” annual negotiations.

Each year, from December 1 to March 1, retailers and manufacturers engage in often tense negotiations that set shelf prices for products (excluding private-label goods).

Minister for SMEs and Trade Serge Papin said it would “likely be necessary to reopen” commercial negotiations, citing inflationary pressures linked to rising fuel prices.

By Vafa Guliyeva