“Tensions in the Middle East were compounded with the news this week that President Trump is taking the US out of the joint US/Russian/European agreement with Iran. This allowed some lifting of economic sanctions in return for closer control over their nuclear programme. Together with turmoil in Venezuela, reducing volumes from African producers and a much-reduced global oil inventory, crude oil prices are set to ramp up swiftly.” Comments Brian Madderson, Charmain of the Petrol Retailers Association (PRA).
As reported in the Telegraph today, some oil traders are now speculating on Brent Crude moving upwards not just to $80/barrel or even $100/barrel but to an eye-watering $150/barrel which would break through peak oil last seen in 2008.
At the same time, the Bank of England is suggesting that there are no early plans to increase UK interest rates due to poor economic data, especially from retail and construction both hit hard by wintry conditions from the “Beast from the East”. This has seen GBP fall back against USD which is the global petro-currency.
Madderson continues, “the merging of UK fiscal and global oil trading issues has placed great pressure on wholesale costs for retail road fuel as reported by Platts. Average costs have risen by nearly 6.00ppl since Easter and there is no immediate softening in sight.”
“Although pump prices have had to rise to reflect such dramatic increases, we are still moving towards 130ppl at the pumps - levels not seen since Autumn 2014 and 30% higher than January 2016. This is going to hit motorists hard and add to inflationary pressures across the faltering economy. The worst outlook of above $100 oil could send pump prices towards the record levels of 142ppl for petrol and 148ppl for diesel reached in April 2012”.
NOTES TO EDITORS:
The Retail Motor Industry represents the interests of operators in England, Wales, Northern Ireland and the Isle of Man providing sales and services to motorists and businesses. The RMI has a formal association with the independent Scottish Motor Trade Association which represents the retail motor industry in Scotland.