The prices motorists pay for a liter of petrol or diesel were much lower last week. This is a decrease of 7 cents per litre. The reason for this is the recent drop in oil prices, but it also has to do with the more expensive euro.
Investors have been worried for more than a week about the turmoil in the stock markets due to problems with banks in the US and Europe. This drives down oil prices. There are fears that the problems will spill over into other banks and cause lower economic growth. So less oil is needed and prices can go down.
On Wall Street, the price of US oil fell 12% this week, the biggest drop in nearly a year. The price of Brent oil, the standard for Europe, the Middle East and Africa, has also collapsed.
At the pump
And that was on display at the gas station. The suggested retail price for a liter of petrol fell 6.8 cents to 1,924 euros in six days, according to consumer collective UnitedConsumers, which monitors fuel prices daily. Diesel has been in decline for some time and has become cheaper by 8.6 cents a liter since last Wednesday to 1,726 euros. These prices are usually only paid on the motorway or in city centres.
“Fuel prices are usually slightly lower than oil prices,” explains Paul van Selms of UnitedConsumers. This could mean that pump prices could fall further. But at the same time, Van Selms warns that prices are now “at a real level.” “They seem a little short to me rather than tall.”
Plus, we can still count on higher fuel prices this summer, warns Van Selms. Then the discount on excise duties, in force since last year, will expire.
Source: BNR
Andrew Dwight is an author and economy journalist who writes for 24 News Globe. He has a deep understanding of financial markets and a passion for analyzing economic trends and news. With a talent for breaking down complex economic concepts into easily understandable terms, Andrew has become a respected voice in the field of economics journalism.
