This is a function of three things:
1. Increased Muslim population. I wouldn't be surprised if pork products also have decreased. It's not just that Muslims won't drink it, but that even French people have to be sensitive to not offend Muslims so won't offer it on the menu at some events.
2. Demographics. France is rapidly aging. Older people tend to go for quality over quantity. The same is happening in German beer consumption.
3. Anglosphere competition. I think that Britain was always Frances biggest export market for wine (and the US too). But did you notice that most of the competitors are part of the Anglosphere: the US, Australia, New Zealand, South Africa. Given the choice, Anglosphere members will choose the wines from their compatriots, especially since the tariffs are usually lower.
4. France has been horrible at marketing its product and at anticipating the trends of the market. They are of the "if you ferment it, they will come" school. Obviously, this has failed.
France can't compete at the low end of the market and can't seem to increase its share of the high end. Paradoxically, the slow food/local food movement championed by the French has had the effect of reducing imports to the US. After all, it burns an awful lot of hydrocarbons just to ship some wine bottles across the Atlantic.
I believe you are correct BUt if you look at Bahrain you will find the hypocracy of the Muslims. They go there and the ladies immediately take off their tents when they get off planes exposing miniskirts and they gamble and dance at nightclube AND they drink.
Soot of like the decadent west.
Marketing along with high prices hurt.
I also had a service company that delt with grocery stores and would ask wine merchants if they'd noticed a turndown in sales of french wines and to a one they all said definately after 9-11 and the Iraq invasion. To a one they all said quite a large percentage drop.