Business News / Has petrol become cheaper? Crude oil is less than 80 dollars for 20 days

Zoom News : Jan 16, 2024, 07:58 AM

Business News: Now the effect of tension in the Middle East is less visible on oil prices. The special thing is that for the last few days there has been a decline in the price of crude oil. On the other hand, due to the strengthening of the dollar, the price of crude oil has also declined. Like December, so far in January the average price of oil in Gulf countries has been less than $ 80 per barrel. Even after that, till now no change has been seen in the prices of petrol and diesel from the oil companies of the country.

If experts are to be believed, a decline in the prices of petrol and diesel may be seen in the coming days. The important reason for this is the Lok Sabha elections. In which the government can issue instructions to OMC to reduce petrol and diesel. There has been no change in the prices of petrol and diesel since May 2022. Let us also tell you what the price of crude oil has become in the international market and what is the level of petrol and diesel prices.

Crude oil prices

There is a decline in the price of crude oil on Monday. Due to less impact of Middle East tension on crude oil production, profit booking was seen with a rise of 2 percent last week. Brent crude oil from Gulf countries fell 14 cents, or about 0.2 percent, to close at $ 78.15 per barrel. There was no change in US West Texas Intermediate crude due to the US Martin Luther King Jr. Day holiday.

Tankers changed routes

The US and Britain targeted Houthi positions in Yemen in response to Houthi attacks on shipping in response to Israel's war against Hamas in Gaza. After which many tanker owners avoided the Red Sea and many tankers changed their route on Friday. Many natural gas tankers have also stopped. Tamas Varga of oil broker PVM said investors are aware that there has been no adverse impact on oil supply. This is the reason why profit booking was seen in oil last week. Also, due to the slight strengthening of the dollar the decline has increased to some extent.

Houthis' warning

Yemen's Houthi chief negotiator warned on Monday that attacks on ships headed to Israel would continue. An anti-ship ballistic missile fired by Houthi militants struck a Marshall Islands-flagged, US-owned and operational container ship on Monday, the US military said on social media platforms. Citi analysts have written that till now there has been no loss in oil supply. But to avoid the Red Sea, ships carrying 35 million barrels have to take a long journey. Due to which the market seems to be very tight.

Why are prices decreasing?

In Libya, people protesting against alleged corruption have threatened to close two more oil and gas facilities after closing the 300,000 barrel per day Sharara field on January 7. America and Canada are struggling with cold weather due to which some oil production is stopping. The North Dakota Pipeline Authority estimated Monday that North Dakota oil production has declined by 400,000-425,000 bpd due to the extreme cold and related operational issues. Phil Flynn, an analyst at Price Futures Group in Chicago, said the cold weather is affecting production, but (prices) appear to be coming down on the perception that this cold is going to end soon. The economic situation also remains somewhat disappointing, with the European Central Bank warning that it is too early to discuss cutting interest rates.

Prices haven't changed since when?

On the other hand, there has been no change in the prices of petrol and diesel in India. The last change in the prices of petrol and diesel in the metropolitan cities of the country was seen on May 21, 2022. At that time, the country's Finance Minister Nirmala Sitharaman had reduced the tax on the price of petrol and diesel. After that some states tried to influence prices by reducing or increasing VAT. The interesting thing is that ever since the prices of petrol and diesel started changing daily in the country as per the international market, this is the first time that petroleum companies have not made any changes during the record timeline.

Price of petrol and diesel in major cities of the country