The Impact of Fuel Price Fluctuations on Road Transportation Safety Across Europe

Abstract This study examines whether fluctuations in real fuel prices influence road-traffic accidents across 28 European countries from 2010 to 2023. Using a panel econometric framework combining two-way fixed effects and first-difference instrumental variable (FD-IV) estimation, Brent crude oil prices (in euros) serve as an exogenous instrument for domestic fuel prices. Results show no consistent causal link between fuel prices and accident totals. The baseline FD-IV model yields a short-term positive elasticity (β ≈ 0.21, p = 0.003), implying that a 10% increase in diesel prices corresponds to a 2.1% rise in accidents; however, this effect disappears once pandemic years (2020-2021) are excluded. Robustness checks confirm the insignificance of the relationship across alternative specifications. The findings suggest that price-accident correlations are transient and crisis-driven rather than structural, underscoring that long-term road safety depends primarily on infrastructure quality, enforcement, and vehicle safety standards rather than energy price fluctuations.