Oil price surge leads to fears of bitumen shortage in construction
- The foundation of roads, sidewalks, and pavements relies on bitumen, a substance made from oil.
- Due to the blockage of the Strait of Hormuz, bitumen prices have soared from 450 to 650 euros per ton in the past two months.
- This increase may halt many construction projects, as reported by TF1’s 8pm news.
To pave the roads you drive on, a mixture of sand, gravel, and bitumen, a by-product of oil, is needed. If the Strait of Hormuz remains blocked, the head of the company visited by our reporters fears a shortage and is preparing in advance.
“We keep our tanks filled to avoid running out. If in May or June we’re told there’s no more bitumen… without it, we can’t work; it’s temporary unemployment. In my thirty-five years here, I’ve never experienced a bitumen shortage,”
explains Philippe Poupart, site manager at Société Francilienne d’Enrobage (SFE) in Gennevilliers, France.
€90,000 extra cost for a three-kilometer road
This industry professional has never seen such a rapid price hike: bitumen prices rose by €200 in a month. As a result, clients face a 10% increase in upcoming projects like schoolyards, sidewalks, and roads.
“The local authorities we work for usually have fixed budgets, and we will bring additional costs that exceed their budget. They will have two choices: do less or postpone to next year. Hence, the uncertainties for this summer,”
details Francis Dubrac, CEO of Dubrac TP in Saint-Denis, France, in the TF1 report above.
The peak season for public works is in summer, with July and September being the busiest months. “This is really bad timing after a municipal period where not much was done,”
adds Francis Dubrac.
If raw materials run out, this company, with full tanks, could carry on for fifteen days before having to pause their projects.
