ITALY: Country suffers sky high petrol prices as 'friendship treaty' falls apart

Record ID: 643721

  • Title: ITALY: Country suffers sky high petrol prices as 'friendship treaty' falls apart
  • Date: 9th March 2011
  • Summary: ROME, ITALY (MARCH 8, 2011) (REUTERS) CARS AT PETROL STATION CAR BEING FILLED UP WITH PETROL PRICE OF PETROL ON MONITOR PRICE OF 1.59/LITRE ON MONITOR VARIOUS CARS AT PETROL STATION (SOUNDBITE) (Italian) CAR OWNER MARIO SGAMBARI SAYING: 'God - even more price rises, I'm sure it won't stop. It is definitely because we import so much from Libya and we are therefore held hostage by events in that country.' VARIOUS PRICES OUTSIDE PETROL STATION PRICE READING: 1,599/LITRE (SOUNDBITE) (Italian) PETROL STATION OWNER FRANCESCO ANGELINI SAYING: 'The prices have really gone up, two or three times in the last week. Now the unleaded petrol is 1,59 per litre this is a record price. The principal reason, I think, is because people are trying to make some money. They have the excuse of Libya but I doubt this is the real reason, It's not as though they are buying the petrol now. They are using petrol that has already been purchased. Who knows how much events in Libya really matter.' VARIOUS CARS FILLING UP WITH PETROL (SOUNDBITE) (Italian) CAR OWNER FRANCO MARINI SAYING: 'The situation is terrible, it is difficult and it looks as though it will remain difficult for everyone with a car.' VARIOUS PETROL STATION
  • Embargoed: 24th March 2011 12:00
  • Keywords:
  • Location: Italy, Italy
  • Country: Italy
  • Topics: Economic News
  • Reuters ID: LVA4SB9D7Y7WHYSZE1RT3MLZ4GOX
  • Story Text: Italy, which did more than any country to legitimise Libya and its mercurial leader, is going through a foreign policy nightmare as civil war in its former colony threatens its energy supplies, international image and the stability of some of its blue chip companies.
    Petrol prices are now sky high in Italy.
    This week the price for a litre of unleaded petrol reached a record 1,59 euro causing indignation amongst motorists and questions whether the price hike could all be attributed to the crisis in Libya.
    'God - even more price rises, I'm sure it won't stop. It is definitely because we import so much from Libya and we are therefore held hostage by events in that country' said motorist Mario Sgambari at the petrol pump.
    Just six months ago, Prime Minister Silvio Berlusconi and other officials fawned over Libyan leader Muammar Gaddafi, treating him like visiting royalty despite his quirky antics as he made his third visit to Italy in two years.
    Now, a 2008 "friendship treaty" that prohibited Italian bases from being used in any military action against Libya has been officially "suspended" while Italy seems to be grabbing at straws over what policy to take with Libya.
    The numbers tell the story. Italy relies on imports for about 80 percent of its energy needs. About 32 percent of Libya's oil production goes to Italy -- an amount which makes up for about 25 of its imports -- and about 12 percent of Italy's gas comes from Libya.
    'The prices have really gone up, two or three times in the last week' said petrol station owner Francesco Angelini.
    'Now the unleaded petrol is 1,59 per litre this is a record price. The principal reason, I think, is because people are trying to make some money. They have the excuse of Libya but I doubt this is the real reason, It's not as though they are buying the petrol now' Angelini said.
    Motorists are really starting to feel the pinch with the increase in petrol price and with no solution to the situation in Libya on the horizon, fear the price could go even higher.
    'The situation is terrible, it is difficult and it looks as though it will remain difficult for everyone with a car' said car owner Franco Marini.
    Flush with petrodollars, Libya has been buying stakes in Italian companies while Italian companies have clinched contracts for energy and infrastructure projects in the country it ruled as a colony from 1911 to 1943.
    Apart from energy, the web of commercial interests includes banking, car making, construction, textiles, railways, aerospace and even soccer clubs.
    So far Italy has not been a cheerleader for sanctions against Libya or measures calling for the freezing of its assets or the imposition of a no-fly zone. Italy has said it will follow the lead of the European Union's, NATO and the United Nations on all counts.
  • Copyright Holder: REUTERS
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