Blair convenes talks to resolve UK’s worst ever fuel crisis

"Legitimate protest is one thing. But we have to look at the disruption that is now being caused," said a Blair spokeswoman.

What began five days ago as scattered blockades over Europe’s highest petrol prices, mimicking French action, has rapidly escalated into nationwide panic. Anxious motorists have worsened the problem by stockpiling fuel and businesses are warning the government of imminent crisis.

Blair began emergency talks with Home Secretary (Interior Minister) Jack Straw, Department of Trade and Industry Secretary Stephen Byers and Chief Secretary to the Treasury Andrew Smith.

Shares in supermarkets fell on fears the retail sector would be next hit, while emergency services rang alarm bells about everything from blood supplies to firefighting.

The emergency powers, which could be invoked as early as Tuesday, would aim to ensure that hospitals, schools and other vital services have enough fuel to keep working. Oil companies could be directed to keep supplies flowing to the most needy.

"This is by far the worst crisis we’ve had in 25 years. The government has to step in immediately," the Royal Automobile Club (RAC) said, predicting London garages would run out of petrol by the end of the day.

Truckers and farmers blockading refineries and fuel depots say their protest is spontaneous and not organised by any political party. So far demonstrations have been peaceful.

Similar protests have hit the continent. But Britons pay more for their petrol than any other European, squeezed by hefty fuel taxes and oil prices hitting a near 10-year high.

Paradoxically, Britain is a big oil producer itself and the Treasury has made windfall gains from high crude prices.

By Tuesday midday, the big operators said about half of Britain’s 13,000 filling stations were now dry.

In the worst-hit areas, rubbish went uncollected, hospitals cancelled non-emergency services and supermarkets said food may be next. The first trains were cancelled for lack of fuel; meat producers said they may have to stop slaughtering on Wednesday.

"Obviously this is causing very great difficulty," Education Secretary David Blunkett said in one of a series of interviews. "We are on the edge of a very real problem if we can’t resolve the difficulty of getting petroleum to the pumps."

New labour on the line

The growing disruption presents the Labour government withits biggest threat since winning office in 1997, melding business, farmers, unions and motorists in a powerful coalition.

Unlike France, starting point of the fuel protests whichthen fanned out across Europe, the British government has vowed not to concede, setting the stage for a risky conflict.

The Association of Chief Police Officers said they wouldhandle the pockets of protest in a "firm but fair" manner.

Truckers staged more disruptive action at key points acrossthe country, snarling traffic with organised go-slows. The areas worst hit by blockades are Wales and northwest England.

The RAC said some garages around London were hiking pricesas stocks dwindled, accusing operators of profiteering.

Tax and duties make up 76 percent of the price of unleadedpetrol, which costs about $1.21 a litre in Britain, and protesters want those levies cut.

The speed with which the demonstration mushroomed has takenBritons aback. What began as a patchy protest by truckers, taxi drivers and farmers took on a life of its own as mobile phones and E-mail helped coordinate action nationwide.

The "New Labour" government is also anxious to protect itsassiduously honed image as a reliable leader of a modern, strong economy. Images of widespread unrest, shortages and shutdowns are an emotional reminder of the state of the nation in the 1970s, before "Iron Lady" Prime Minister Margaret Thatcher transformed Britain with her right-wing policies.