Fuel is pretty expensive right now

Not much is missing, and fuel will be more expensive than it has been in three years. The oil price is rising and the euro is no longer appreciating.

Gas station in the city center of Trier

ÜIt is usually assumed that fuel prices at petrol stations peak on public holidays. This time there was a small tip, but most drivers would be happy to have to pay only 1.36 euros for the liter super. The current average is 1.40 euros. For diesel it is 1.22 euros – at Easter it was 1.19 euros.

This means that prices are only around 2 cents away from their annual highs in January. And even if they fell marginally this week, the upward trend since mid-March is unmistakable.

The reason for this is the price of crude oil, which has been rising for ten months. A barrel (159 liters) of Brent North Sea oil currently costs $ 74, two thirds more than last June.

BRENT

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The fact that German drivers have been hit harder since mid-March is also due to the less favorable development of the euro exchange rate. This has not appreciated since the beginning of the year and if the oil price fell slightly at the beginning of the year, especially in the wake of the short-lived February crash on the stock markets, motorists in this country are now hit with full force by the increase.

One reason for the rising oil price is geopolitical tensions. Syria is not an oil producer of great importance, but the tense relationship between the West and Russia is causing the reflex to fear negative repercussions on oil production. Possible new restrictions on Iran are more of fundamental importance. The nuclear agreement with the country in particular caused prices to fall some time ago.

WTI Light Sweet Crude Öl

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To the detailed view

Above all, however, American inventories continue to fall. This trend pretty much coincides with the start of the upward movement in price ten months ago. On Thursday, inventories fell 1.2 billion barrels below their five-year average. On the oil market, this is an indicator of excess demand.

In the short term, there is now an OPEC meeting on Friday. Observers anticipate an extension of the price-supporting production cuts, so that the trend should not change.

In the longer term, a lot will depend on how geopolitical tensions develop. Should this decrease, analysts expect the Brent price to drop to $ 70.

Analysts are a little more optimistic about America. The strong production growth there should put price pressure on American oil, relative to North Sea oil.