The Organisation of Consumers and Users (OCU) estimates a rise of between 8 and 10 cents per litre of fuel in the coming weeks, provided that the price of Brent crude remains stable at around $80 per barrel, where it is currently trading, due to the impact of the conflict in the Middle East following the military intervention by the United States and Israel in Iran.
In a statement, the association warns that the recent rise in the price of Brent crude oil, currently around $82 per barrel, ‘has not yet been significantly reflected in fuel prices in Spain’, because although ‘the rise in crude oil prices is usually passed on fairly quickly due to the well-known “pen and rocket” effect, the final impact depends on the magnitude and stability of the increase, as well as geopolitical and financial factors’.
It therefore indicates that the usual behaviour of the sector shows that the transfer of the increase in Brent crude oil prices to the pumps ‘can vary between several days and several weeks’, considering in this case ‘a gradual impact, closer to two weeks, to be more likely, provided that crude oil remains stable at current values’. The OCU points out that, for the moment, average fuel prices have hardly changed, with the increase in recent weeks responding more to the previous rise in Brent, which went from $65 to $70 between the end of February and the beginning of March, than to the recent tension in Iran.
The Minister of Economy, Trade and Enterprise, Carlos Cuerpo, said on Tuesday that it is still too early to know the final impact that the crisis in the Middle East will have, but, in any case, he assured that the government will be ‘on top of prices’ to react if necessary and minimise the negative effects that this war could have on citizens and businesses, including transport companies and large industries.
‘Unfortunately, we already had to go through a similar episode in 2022 as a result of the invasion of Ukraine, so we are perfectly prepared to know what we have to do if necessary, protecting our citizens and businesses through this shield,’ the minister stressed in statements to TVE reported by Europa Press. Cuerpo stressed that right now we are in the phase of ‘monitoring and tracking’ the effects that this conflict may have and that the impact of this crisis will depend on its duration.
‘We hope that this conflict can be resolved as soon as possible,’ said Cuerpo, who acknowledged that if the rise in oil prices continues in the coming days and weeks, it will end up being reflected in fuel prices. ‘But as I said, it is still too early to have an idea of how these effects will be transferred to consumers’ daily lives. We are going to wait and see, we are going to monitor the situation to avoid any speculative movements that may occur in this regard. We are going to keep a close eye on prices in an attempt to minimise the impact on citizens and our companies, including transporters and large industries,’ he said.
In any case, the minister insisted that for now, ‘we must be cautious,’ because only a few days have passed since the start of the bombings and it is too early to know the final impact of the crisis.
Despite yesterday’s rise in gas prices, which closed above €40, Cuerpo pointed out that in the case of the war in Ukraine, prices exceeded €340.
‘This gives us an idea, I think a relative one, and helps us to put things into context, but we must be vigilant because, to a large extent, the final impact will depend on the duration of this conflict, and here I would simply reiterate the Spanish Government’s call for de-escalation and the opening of diplomatic channels to resolve it,’ he stressed.