Fuel prices stagnated in 2018 (April 29 – May 6). Diesel prices were unchanged at €1.541/l, while petrol prices increased but only by €0.001/l, i.e. 0.06% to €1.66/l.
In the Czech Republic, fuel prices fell this week. Gasoline prices fell by 0.44%, i.e. by €0.176/l to CZK 40.22/l, while diesel prices fell slightly faster, by 1.37%, i.e. by CZK 0.53/l to 38.42 CZK/l. The reason was primarily the stronger koruna, which strengthened by up to 0.72% during the week.
Oil prices fell for the week and finally closed at $82.96 per barrel, down 7.3% from the previous week. The reason was primarily the increase in inventories in the US, which indicated weakening demand. However, this week we are seeing a slight stagnation after the price decline, with oil prices hovering at $84 per barrel, up 1.27%.
The slight increase in prices was mainly due to the decline in US inventories, but stabilization of prices after a strong correction occurs regularly, so it was not a surprise. Pre-season US refinery utilization is gradually picking up again, with refinery utilization 1 pp higher than the previous week at 88.5%, but still significantly lower than last year, when pre-season refinery utilization was up to 91% of total capacity. This still suggests weaker demand for fuel in the United States and a significant boost to oil price growth is thus missing.
However, slightly more positive data is coming from the East, with China’s foreign trade data suggesting stronger demand. China imported about 10.88 million barrels per day in April, up 5.45% from a year earlier.
As for geopolitical risks, the primacy between Hamas and Israel has not been confirmed, rather the opposite. Israel appears to have launched one of its latest operations in Gaza, an attack on the southern part of the city. However, the debates about the cease-fire are not over yet, but the market is forgetting about this risk for the time being, as the risk of Iran’s involvement in the conflict is gradually decreasing.
Wholesale fuel prices in Rotterdam were mixed as while petrol prices continued to fall, diesel prices rebounded slightly from their near-term lows. In Slovakia, however, the discounting of wholesale fuel and oil prices has not yet been reflected in the statistical data, which are delayed by a week. So there is still room for discounting. The oil market is also still in a downward trend and we do not yet see a significant impetus for recovery. However, seasonality will gradually show itself this month and the price decline may stop. The June meeting of OPEC will also be important, which may further extend restrictions and continue to limit supply, which would once again put upward pressure on prices.
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