Towards a fall in the price of fuel? OPEC opens the floodgates (a little) – Economy


Can we expect any good news in terms of fuel prices at the pump? There is hope after the announcement, Thursday April 1, 2021, of an increase in oil production by OPEC + member countries, that is, OPEC and its allies.

2 million more barrels of crude per day

It seems that Saudi Arabia, leader of OPEC, has succeeded in convincing its allies… and has decided to respond to international weighing on the price of oil. Because OPEC makes the market rain and shine: if it reduces production, prices rise, if it increases it, prices fall. A technique used regularly to arbitrarily change the price of a barrel of crude that OPEC has widely used since the start of the Covid-19 crisis.

Thursday, April 1, 2021, however, OPEC + announced to increase its crude production by 2 million barrels per day between May and July 2021. What alleviate a little the pressure on the market, which is slowly recovering with an increase in demand due to the resumption of flights and activity. But production will remain below 2019 levels of nearly 6 million barrels per day, in order to keep price levels high.

A drop in fuels to come?

For motorists, however, this is good news: the increase in production will lead to a fall in the price on the stock market, or at least will slow down the rise (the barrel having climbed by more than 10 dollars since the beginning of the year, and having almost doubled in price since the summer of 2020).

It will however be necessary to wait a few weeks or even months before the evolution of the price of crude on the stock market has repercussions on the prices of gasoline and diesel. And we should not expect a significant drop: more than half the price of a liter of fuel in France is made up of taxes of a fixed annual amount. But just 5 cents less, on a full 60 liters, that’s 3 euros saved …