How long will oil prices go down? And how much will we refuel?

During the last week, the development of fuel prices took a surprising turn. While gasoline rose slightly in price, diesel, on the other hand, became cheaper. The average price of gasoline in the last 7 days increased by 6 hals to 38.91 K per liter. Diesel, on the other hand, became slightly cheaper – by 9 hals to 39.32 K per liter. In the following weeks, however, prices for both gasoline and diesel fell. The price correction could be partly similar in units of crowns. The price of brent oil has fallen on the market for two weeks in a row. From this, the great premium that oil prices gained after the outbreak of the conflict in the Middle East has evaporated. Currently, the price of Brent oil is even below the level before the arrest of the wolf. Since the second half of June, the price of a barrel of Brent oil has even fallen by less than 12 dollars to a total of 82 dollars. The drop in oil prices is due to growing concerns about the health of the global economy. In the US, the labor market is weakening, and we will face a fall into deflation and a drop in exports. In addition, the markets consider the conflict at the Near Entrance only a trick and do not pay so much attention to it. However, this may not be the case, in our view, the risks of an escalation of the conflict are very high, and oil prices can swell at any time. However, cheaper oil will be reflected in the prices at local gas stations in the following weeks. The average price of diesel and gasoline could thus fall below 38 K per liter.

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A slight negative effect was caused by the development of the Czech crown, which is due for the import of oil and fuel. Last week, after the NB session, the koruna jumped, we even fell below 24.35 K/EUR against the EUR. This message did not last long and the exchange rate quickly weakened back above 24.60. The koruna could weaken by the end of the year. However, the situation at the nearby entrance still poses a great risk. Diplomatic negotiations can fail at any time, and a failed ground operation in the Gaza Strip could drive oil prices to record highs. Israel even healed it with an operation in the Gaza Strip, but this is not a big planned invasion. The worst scenario for oil prices was the involvement of Iran, Lebanon and the fall of the USA in the conflict. The US even takes it to the area of ​​submarines. In such a case, the price of oil may attack even the historical maximum of around 140 dollars per barrel. There should also be pressure on the market from Saudi Arabia and Russia. Both countries this week confirmed the extension of their voluntary production cuts until the end of the year. Although this was not surprising, it is quite possible that the country will be late until the end of the first quarter of 2024. The first month of the year is traditionally associated with the demand for oil.

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