BARREL PRICE. The barrel of Brent oil is rising again this Monday, January 21, once again casting doubt on the increase in prices at the pump in France. What effect? How to analyze these fluctuations? We tell you everything.
[Mis à jour le 21 mars 2022 à 07h52] The price of a barrel of Brent oil has been rising again for a few days, and mainly this Monday, March 21. $111, is its price on Monday morning, slightly but steadily increasing since last Thursday. In this context of extreme economic and social tension, several blocking movements and filtering dams are expected across France and in the Bouches-du-Rhône. But then, how to explain a certain slowdown in fuel prices while the war continues in Ukraine?
Europe is still extremely dependent vis-à-vis Russian gas, it still cannot position itself strongly in favor of an embargo. Joe Biden, the President of the United States, did it. But Europe remains much more reluctant to this idea. This is why the price of a barrel of oil has calmed down slightly. Pay attention, however, to the oil price volatility, extremely dependent on the next European decisions and the progress of the war in Ukraine. The rise of the euro against the dollar in recent days also gives hope for a slightly more lasting drop in fuel prices in the days to come. Both diesel and unleaded prices should remain around 2 euros per litre, far from the surge of March 11 to 2.20 euros/litre.
Faced with the unprecedented increase in the barrel of oil last week, close to 140 euros per barrel, member countries of the International Energy Agency (IEA) should release no less than 60 million barrels of oil of their reserves. One objective, to stabilize a market in panic. So, should we expect a further rise in fuel prices in France, when the prices charged have already reached record highs? As fuel prices are strongly indexed to the price of a barrel of oil, a further rise in pump prices is to be expected despite the new aid measure put in place by the government. French consumers could well be the first victims of a potential embargo. Difficult for Europe to turn around quickly, alternatives are possible, but they will take time before being put in place.
Since the start of the week, we have seen a small respite with relative stagnation in prices. These fell back below 100 dollars at the start of the week before rising again. This is not to displease French households who have observed a certain smoothing of prices for several days at the pump, far from the surge of last week (2.25 euros on average for a liter of diesel). And as good news never comes alone, Prime Minister Jean Castex announced two aids on fuel, Wednesday March 16, during the press conference presenting the resilience plan. First, a discount of 15 cents on fuel for all French people from April 1 and for 4 months. Then, more help from 35 cents per liter of fuel fishing for fishermen hard hit by the price explosion. Aid valid from April 17 to July 31 to allow them to go back to sea in decent conditions.
- March 7, 2022: $139 the barrel
- March 8, 2022: $128 the barrel
- March 10, 2022: $110 the barrel
- March 15, 2022: $98 the barrel
- March 16, 2022: $100 the barrel
- March 17, 2022: $106 the barrel
- March 18, 2022: $109 the barrel
- March 21, 2022: $111 the barrel
The war in Ukraine casts doubt on the supply and price of energy. Aside from gas, one question remains central and arouses curiosity, what is the price per barrel of oil in this mess? Rising almost constantly since December 2021, the price of a barrel is now stable around 100 dollars, measured exactly at $109 this Friday, March 18.
When you fill up with gas, the taxes represent 60% full. And these taxes, they, in spite of the war in Ukraine, fluctuate rather little. In particular the domestic consumption tax on energy products (TICPE), which simply represents the fourth revenue of the State, behind VAT, income tax and corporate tax. the fuel price leaving the refinery, it corresponds to 1/3 full of gasoline. Notably influenced by the price of a barrel of oil on international markets. Gas station attendants will have no choice but to pass on this increase to the price per litre.
Keep in mind that there is a lag time between the increase in the purchase price of a barrel of oil and the real impact on prices at the pump. This time varies 8 to 10 days about. In an attempt to curb this phenomenon, several aids have been put in place and distributed by the Government. In particular the inflation bonus granted to 38 million low-income households, as well as the revaluation of the mileage scale for 2.5 million tax households. The threat of a embargo European on Russian gas could cause the price of a barrel of oil to explode at $300or even more.
According to INSEE, the Russia is the 3rd world producer of oil with 10 million barrels per day, of which 2 million transit to Europe. The Franceshe matters 9% of its crude oil since Russia. And the countries which could substitute the major role of Russia in the export of oil are not legion. Nigeria, Angola and Libya, for example, are not even meeting their own production targets. the Nigeria (9.6% of oil imports in France), theAlgeria (10.3%), and theSaudi Arabia (11.8%) remain crucial trading partners for France to whom the government could turn more to supply the country.
“We have significant strategic oil stocks which cover almost three months of consumption and allow us to deal with supply disruptions. The French are not at risk of running out of fuel or gas for heating in the coming months” declared the Minister for the Ecological Transition, Barbara Pompili on February 23. The European Union could even decide to release part of its strategic oil stocks to counter the rise in fuel prices in the face of this major market disruption. A decision taken only three times in history, for example after Hurricane Katrina in the United States.