More OMCs cut fuel prices… Butoil jumps as soft dollar, tight supply supports

More Oil Marketing Companies (OMCs) are expected to review prices of petroleum products downwards, from this week.

It’s coming after the Bulk Oil Distributors cut the prices of finished petroleum products.

One of the leading market players, Total Energy, has already slashed prices of fuel at the pumps since last week.

GOIL has also cut its fuel prices with petrol going for ¢11.30 and diesel trading at ¢13.63.

The reduction in prices of petroleum products could compel transport operators to delay their agitations for increase in transport fares.

It could also help contain raising cost of living in the country in recent times.

Prices of Petroleum products begun going down from the weekend (July 16).

According to myjoyonline, Diesel is expected go down by more than 11 per cent per litre, whilst petrol and LPG would fall by four per cent per litre and 10 per cent per kilogramme respectively.

Chief Executive of Chamber of Petroleum Consumers, Duncan Amoah, said there was every indication that fuel prices would decline by some five per cent between the two products – petrol and diesel.

“We pick every indication that pump prices will decline or go down by some five per cent between the two products – petrol and diesel.”

Meanwhile, oil prices extended gains yesterday, boosted by a weaker dollar and tight supplies that offset concerns about a recession and the prospect of widespread COVID-19 lockdowns in China again reducing fuel demand.

Brent crude futures for September settlement rose by $2.14, or 2.1 per cent, to $103.30 a barrel having gained 2.1 per cent last Friday.

U.S. West Texas Intermediate (WTI) crude futures for August delivery were up $1.72, or 1.8 per cent at $99.31 after rising by 1.9 per cent in the previous session.

According to Reuters, both Brent and WTI last week registered their biggest weekly declines for about a month on fears of a recession that would hit oil demand.

 Mass COVID-testing exercises continue in parts of China this week, raising concerns over oil demand from the world’s second-largest oil consumer. However, supplies remain tight. As expected, U.S. President Joe Biden’s trip to Saudi Arabia failed to yield any pledge from the top OPEC producer to boost oil supply.

Biden wants Gulf oil producers to step up output to help to lower oil prices and drive down inflation. Global markets are focused this week on the resumption of Russian gas flows to Europe via the Nord Stream 1 pipeline, which is scheduled to end maintenance on July 21. Governments, markets and companies fear the shutdown could be extended because of the war in Ukraine. “Brent crude will find support at the end of the week if Russia does not turn the gas back on to Germany after Nord Stream 1 maintenance,” said OANDA senior analyst Jeffrey Halley.

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