Fuel Prices Continue Downward Trend Despite Crude Oil Bounce Back
Fuel prices have continued to trend downwards over the past month, despite increases in nationwide traffic levels and a noticeable increase in crude oil prices.
According to the AA’s latest fuel price study, the cost of a litre of petrol has now fallen to the lowest level recorded by the organisation since March 2016. On average, a litre of petrol now costs 121.8c – down almost 2c from last month’s average price of 123.7c. Meanwhile, diesel prices have also continued to fall, dropping by 1.6c on average to a current price of 113.9c.
Both fuels have dropped significantly in price compared to the start of the year, when a litre of petrol cost 144.5c, with diesel costing 135.9c on average.
“On many major routes across the country, according to TII data, traffic levels have increased by over 100% compared to the first week of COVID-19 restrictions, and the continued drop in fuel prices is welcome news for those who are now beginning to travel more regularly. Reduced capacity on public transport may mean that some are more reliant on the private car than they were pre-COVID and lower fuel prices is a positive for those who need the car to commute to work or assist elderly relatives currently,” Conor Faughnan, AA Director of Consumer Affairs stated.
Following a short-term, significant drop in late April and early May, crude oil prices have continued to trend upwards – but still remain significantly below levels seen before the COVID-19 outbreak. Currently, Brent Crude Oil is trading at approximately $40 per barrel, up from a price of $35-$36 per barrel in late May. However, this price of crude oil remains significantly below prices of up to $65 per barrel seen in late 2019.
“With global demand for fuel and oil now starting to increase as many countries continue to ease their COVID-19 restrictions, it comes as no surprise that crude oil prices are starting to increase. Despite this, prices at the pump remain low, but for how long remains unclear,” Faughnan added. “Demand is likely to remain below pre-COVID levels due to the large numbers of people working from home globally or choosing to walk or cycle more regularly, but for those who must drive it’s important to remain loyal to your own pocket and get into the habit of comparing prices at multiple garages and purchasing your fuel from whichever one is offering the best price.”