Fuel rebates granted by the government in 2022 benefit more affluent households, the largest commuter, according to a study by Insee* published Thursday, July 6.
Fuel prices exploded in the spring of 2022, buoyed by the post-Covid recovery and then the aftermath of the war in Ukraine. Then the government introduced a rebate of 15 to 18 cents including tax per liter of fuel, increasing to 30 cents in September and October.
sequel after announcement
Flexible habits among ‘young riders’
The Insee simulation indicates that it led to an average reduction in motorists’ bills from 51 to 81 euros. The richest 25%, who consume more fuel on average, benefited the most from this measure (between 64 and 115 euros, compared to between 29 and 48 euros for the poorest 25%). This exemption, however, represents a smaller share of their income, INSEE analysis found.
And when prices rise by 1%, motorists delay their fuel purchases and volumes drop in the short term, by 0.21% to 0.40%, according to the study. These modifications are three times stronger “little reels” (those who spend less than 17 euros per month on fuel) are more likely to change their habits or postpone their purchases.
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rural or semi-urban areas “big wheels” (more than 120 euros per month of fuel), with their high average consumption particularly associated with long business trips from home, which reduces the volume of fuel consumption after the price increase. Thus, they benefited more from the rebates granted by the government.
This resulted in an average price reduction of 10.8%, compared to market price developments. Compared to the situation in which prices would have remained at their high level at the beginning of 2022, these discounts have increased fuel consumption by an estimated 16 to 31 liters. This increase represents between 2.2% and 4.2% of the average annual consumption of a family of motorists, i.e. 740 litres.
According to this study, urban motorist households spent €981 in fuel costs on average in 2022, compared to €1,480 for households living in peri-urban areas and €1,855 for those living in rural areas.
* For this study, statisticians drew on bank data for 10,777 Crédit Mutuel motorists, anonymized and analyzed between September 2021 and January 2023.