There has been a sustained fall in prices at Hungarian wells since the end of September.Continue reading
On Friday, the price of petrol will slightly decrease at Hungarian gas stations, while the price of diesel will remain unchanged, Index reported.
Last Monday, the price of diesel increased slightly (by 3 forints), but the price of petrol did not change. According to holtankoljak.hu, on the first day of December
the price of petrol will fall by 3 forints gross, while the price of diesel will remain unchanged for the rest of the week.
Thus, the last month of the year will begin with the following average prices:
Index recently summarized the factors behind the current petrol and diesel prices. As they reported, the market fundamentals have not changed. There is still a refinery operating and the same pipelines are used to transport oil as before, but there are still economically unexplained developments in the fuel market, energy expert József Balogh said. He added that
the most likely scenario is that retail fuel prices have fallen because the MOL group has received a significant discount on mining margins.
“What is happening on the fuel market cannot be explained by market processes. This is probably why a political agreement has been reached between the government and the MOL group. (…) Thanks to the agreement signed recently, the extra mining fee paid by the company is reduced to a maximum of USD 400-450 million for 16 months from September this year,” Balogh stressed, saying that fuel will definitely increase by 41 forints from next year due to the excise tax increase.
At the same time, Ottó Grád, secretary general of the Hungarian Petroleum Association, noted that
the price change could also be explained by market developments.
He summed up the issue by saying that the decrease in the mining tax is basically related to natural gas production, which has nothing to do with fuel prices. He believes that the price decrease can be explained by international economic trends.
However, the international situation is still not favorable. Record high oil prices could be expected in the event of an escalation of the war in Israel, the World Bank warned earlier. In its analysis, it highlighted the possibility of a repeat of the 1973 Oil Crisis. If the conflict spreads beyond the Gaza Strip,
oil prices could rise to USD 157 a barrel.
“In such a scenario, global oil supply would be reduced by 6-8 million barrels per day, similar to the 1973 Oil Crisis, and would initially raise prices by 56-75 percent, to between USD 140 and 157 per barrel,” they wrote. Moreover, it should be noted that the current energy market is already fundamentally tight and sensitive due to the Russian-Ukrainian war and the resulting sanctions.
In the World Bank’s best-case scenario, global oil supply would fall to two million barrels per day in the event of a ‘minor disruption,’ comparable to the decline seen during the 2011 Libyan civil war.
Via Index, Featured image via Pixabay