Since the beginning of the year, oil prices have risen by almost 50%. The cost to the consumer increased by 15%.
It is necessary to go back to 2012 to find fuel prices in Portugal higher than those currently practiced. Analysts believe that this figure will grow in the near future. Today, gasoline prices are expected to rise by a cent, bringing the average price of 95th regular gasoline to 1.66 euros per liter. Diesel is expected to remain unchanged, averaging € 1,448 last week. The blame lies in the rise in oil prices on international markets, as well as the heavy weight of taxes on the final price of fuel in Portugal.
Since the beginning of the year, the price of Brent, a benchmark for European markets, has already risen by almost 50% and closed on Friday at $ 76.17 per barrel. On the other hand, the increase in fuel was about 15%. The problem lies in the tax share, since about 60% of fuel prices are tax revenues. This means that the increase in the amount of raw materials only affects the remaining 40%.
inconsistency
Even a study by the Portuguese Association of Petroleum Companies (Apetro), published last Friday, testifies to this. There is much speculation as to why, with oil and petroleum product prices well below the 2008 peak, pump selling prices are higher than at that time, Apetro admits, stressing that “the explanation for the increase , first of all, in the tax burden ”(ISP – tax on petroleum products and VAT – value added tax).
OPEC +, an alliance that brings together the Organization of Petroleum Exporting Countries and other relevant producers, especially Russia, met this week, but twice there was no agreement to increase production. Trading will resume today, but as Bloomberg warns, the lack of a deal could put pressure on an already tense market, potentially contributing to a sharp rise in oil prices. In fact, the opposite scenario is also possible. It should be remembered that in early 2020, the lack of an agreement between Saudi Arabia and Russia led to a price war that pushed oil prices very close to $ 20 a barrel.
“The current impasse is a clear sign of the UAE’s intentions: they have a clear mandate to increase production and want to have more influence,” said Amrita Sen, a consultant at Energy Aspect Ltd in London, quoted by Bloomberg.
Abu Dhabi has put forward the idea of leaving OPEC at the end of 2020 as it intends to produce more oil to take advantage of the billions of dollars in investment it has put into expanding its capacity.
The cost may continue to rise
The stalemate recorded this week – and the refusal of UAE delegates to make any concessions – suggests tensions will persist. Paulo Rosa, an analyst at Banco Carregosa, recalls that last year, OPEC and its allies cut production to offset the sharp drop in demand caused by the pandemic, in particular the first restriction and disruption of the economy in spring 2020. “The economy is gradually recovering, driven by the development of vaccination programs. but oil supplies have not returned to pre-coronavirus levels, and if OPEC countries maintain discipline at current production levels, oil still has room to add value, ”he defends. Ricardo Evangelista from ActivTrades also believes that the rise in prices will continue. “With the continuation of the return to normal and the subsequent increase in demand, the price will remain at least at the current level, and may even rise if the OPEC + countries do not reach an agreement between them.”
