2023-08-03 18:56:30
BarcelonaWhen demand grows, prices go up. An economic phenomenon that is reproduced every year in August with fuel prices, when mobility increases for the summer holidays. And although the prices of gasoline and diesel have this week consolidated the upward trend of recent weeks, the cost of fuel for the exit operation will be cheaper than it was a year ago, when the impact of the war in Ukraine was felt more in the cost of fuels.
Evolution of fuel prices in Spain since the outbreak of the war in Ukraine
Price in euros per liter
There are some factors that have made fuel more expensive in recent weeks. In addition to the increase in demand, a key element must be added: the agreement by OPEC+ (the oil-producing countries and their partners, including Russia) to reduce crude oil production by decrease production and raise prices. A factor to which we must also add the expectations of a higher demand in China.
For Bank of America’s global head of commodities and derivatives, Francisco Blanch, the keys to the expected price rises in the oil market lie in Russia, as low prices affect “its war efforts”. Also the fact that OPEC+ is “mobilized” to avoid a collapse in prices. A final factor highlighted by this expert is in the United States, “which has to replenish reserves” and therefore increases demand.
Despite the increase in the price of fuels in the last week, filling the 60 liter tank of a car is between 3 – in the case of petrol – and 10 euros – in the case of diesel – cheaper than a year ago , bearing in mind that at the time the discount of 20 cents per liter decreed by the Spanish government was applied, a measure that expired at the turn of the year.
According to the data of Oil Bulletin of the EU (which averages the prices of almost 11,500 petrol stations throughout Spain), 95 octane petrol has become more expensive by 2.1% in the last week, and diesel by 2.5%. Thus, fuels have been on the rise for four weeks and prices have returned to the levels of April. In fact, the increase in fuel prices was one of the reasons why Spanish inflation in July once again exceeded 2%. In the last week, the average price of a liter of petrol was just over 1.65 euros, and diesel cost almost 1.502 euros.
Since the beginning of 2023, gasoline has become more expensive by 19.3% and diesel by 2.9%. And compared to a month ago, when the July holiday period began, petrol is 3.7% more expensive, and diesel 4.5% more expensive.
19,3%
Since the beginning of 2023, gasoline has become more expensive by 19.3% and diesel by 2.9%
Despite the upward trend in prices in recent weeks, fuels are still far from the historic maximum prices, which occurred in June 2022, when both fuels exceeded 2 euros per liter. In fact, the price of petrol is 15% lower than its historical high, and diesel 21%. Then, because of Europe’s dependence on Russia for diesel, the price of this fuel came to exceed that of gasoline at the time of the maximum rise, but the situation was reversed last February and gasoline returned to be placed at a higher price than diesel, as has historically happened.
Upward trend
Most commodity analysts maintain that the upward trend in the price of oil, and therefore fuel, will continue. Global markets strategist at investment platform eToro Ben Laidler explains that “OPEC supply cuts, resilient economic growth and hopes of economic stimulus from China are driving oil.”
The Wagner Group revolt raised fears of a rise in the price of oil, but its short duration had little impact on the price of crude oil, although analysts believe that in the longer term the price will rise. “The market is likely to have to start valuing a higher risk premium for oil, given the growing instability in Russia,” warn ING Research analysts Warren Patterson and Ewa Manthey.
Immersed in this scenario, fuel prices in Spain, however, were again last week below the European Union average, where the price was 1.789 euros per liter of petrol, and around 1.642 euros, the of diesel They were even more expensive in the euro zone, where a liter of gasoline was paid on average at 1.847 euros, and diesel at more than 1.674.
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