PRICE OF A BARREL OF OIL. The price of a barrel of Brent crude oil rose slightly on Tuesday, September 13. Not very reassuring, when Elisabeth Borne is about to announce the amount of the increase in the cost of energy in France.
[Updated September 13, 2022 3:48 PM] The price per barrel of Brent crude oil is $93 on Tuesday, September 13. Slight rebound compared to the last few days. Still subject to the evolution of the war in Ukraine, in particular due to the reduction of gas deliveries from the Kremlin to Europe, the price of oil varies quite widely. Enough to cast doubt on the energy supply, and the price to pay this winter. The bill for French households could increase considerably, despite the extension of the tariff shield until the end of 2022. The G7 nations should put in place a price cap on Russian oil, so as to continue sanctions against Moscow, while ensuring a circulation, even less, of Russian oil.
In France, the impact could be direct with an upcoming increase in the price of gas and electricity, which will be announced by Prime Minister Elisabeth Borne on Wednesday September 14 during a press conference. Regarding the price of fuel, for the time being, the French are not affected in particular because of the fuel discount of 30 cents, coupled with the rebate of 20 additional cents at Total. In some stations, the liter is therefore offered around 1.30 or 1.40 euros. These two premiums are completely extinguished on December 31, 2022, enough to raise concern, once again, among motorists.
The war in Ukraine casts doubt on the supply and price of energy. Aside from gas, one question remains central and arouses curiosity, what is the price of a barrel of oil in this slump? Rising almost constantly since December 2021, the price of a barrel has now stabilized below 100 dollars, measured exactly at 93 dollars on Tuesday, September 13, 2022.
Since the end of August, the price of oil has been falling almost constantly. After reaching peaks in March 2022 (139 dollars per barrel of Brent), it has fallen back below 100 dollars and could even continue to fall in the days to come.
When you fill up with gas, taxes are 60% of the full tank. And these taxes, they, in spite of the war in Ukraine, fluctuate rather little. In particular the internal consumption tax on energy products (TICPE), which simply represents the fourth revenue of the State, behind VAT, income tax and corporate tax. The price of fuel leaving the refinery corresponds to 1/3 of a full tank of gasoline. Notably influenced by the price of a barrel of oil on international markets. Gas station attendants will have no choice but to pass on this increase to the price per litre.
Keep in mind that there is a lag time between the increase in the purchase price of a barrel of oil and the real impact on prices at the pump. This time varies from approximately 8 to 10 days. In an attempt to curb this phenomenon, several aids have been put in place and distributed by the Government. In particular the inflation bonus of 100 euros distributed on September 15, 2022, and the increase in the fuel discount to 30 cents per liter purchased until October 31, 2022.
According to INSEE, Russia is the world’s third largest oil producer with 10 million barrels per day, of which 2 million transit to Europe. France imports 9% of its crude oil from Russia. And the countries which could substitute the major role of Russia in the export of oil are not legion. Nigeria, Angola and Libya, for example, are not even meeting their own production targets. Nigeria (9.6% of oil imports into France), Algeria (10.3%), and Saudi Arabia (11.8%) remain crucial trading partners for France to which the government could turn. turn more to feed the country.
“We have significant strategic oil stocks which cover nearly three months of consumption and allow us to deal with supply disruptions. The French are not at risk of running out of fuel or gas for heating in the coming months” declared the Minister of Ecological Transition, Barbara Pompili on February 23. The European Union could even decide to release part of its strategic oil stocks to counter the rise in fuel prices in the face of this major market disruption. A decision taken only three times in history, for example after Hurricane Katrina in the United States.
