Brent Crude Oil prices fell last week and today and is currently trading at US$83.38 per barrel, although petrol prices at the pump are lagging behind.
Although there was no obvious trigger to the slump in price, some analysts have suggested it could be due to concerns over China, which looks unlikely to be leaving lockdown after a spike in Covid cases.
Jens Naervig Pedersen, chief analyst at DankseBank, said the slide might “signal concerns over whether China, after all, will not begin to ease lockdowns due to a rise in infections.”
Ipek Ozkardeskaya, a senior analyst at SwissBank added that “the short-term outlook is revised from neutral to slightly negative, with the next natural target for the bears standing at US$76 per barrel.”
Saudi Arabia and other OPEC oil producers are said to be discussing an output increase, the Wall Street Journal reported on Monday, citing the group's delegates.
An increase of up to 500,000 barrels per day is now under discussion for OPEC+’s Dec. 4 meeting, the report said.
In comparison, today's prices continue to be well ahead of pre-pandemic levels, which had dipped as low as US$24.81 at the start of Covid in March 2020.
BP fell 2.6% and Shell 1.8%,
Despite the fall in crude oil prices, the cost at the pump has hardly moved lower.
Diesel prices fell by 1.75p to 188.12p per litre from 11 November to 18 November, while petrol prices moved 1.51p lower to 163.7p.
Earlier this year, in June, petrol was 191.1p per litre and diesel was 198.96p per litre.