Why this matters: Fuel prices fall sharply in midsummer

There is good news for French motorists in the heart of the summer school holidays: prices at the pumps are falling. On Monday evening, diesel averaged 1.663 euros per liter: 5.1 cents less than a week ago (-3%) and 5.8 cents less than a month ago. If compared with last summer’s prices, the drop is more than 16 cents. Compared with January, According to INSEEwith an average drop of 9 cents.

Diesel and petrol decline

The same observation is made for gasoline: the average price of unleaded 95 is 1.768 On Monday, France’s oil price was 1.3 euros per liter. That’s a drop of 4.1 cents per liter in a week and 3.2 cents in a month. If the drop is smaller than in January, According to INSEE (-3 cents), a decrease of 6 cents compared to June.

If the operation of large supermarket chains selling fuel at cost on French roads during the off-road weekend had an impact, this is not the only explanation.

What is the reason for this?

But how do we explain this decline? The price of oil is the first explanation. Concerns about the U.S. economy wait Chinese Oil prices are falling because of their demand for crude oil. On Monday, the price of North Sea Brent crude fell by 1.99% to $75.25 (currently €68.69), shortly after hitting its lowest level since early January. The US West Texas Intermediate (WTI) also fell to a six-month low. The two largest economies on Earth – China is the world’s largest oil importer – are faltering, and that’s why prices are falling. . Less activity, less demand for oil, and therefore less demand: prices fall. Another reason: the euro is slightly stronger against the dollar, which is again suffering from concerns about the US economy.

Can this last?

Many parameters are taken into account when constructing gas station prices, and past experience shows that trends can quickly reverse. In addition to the economic backdrop, there is also geopolitical news. Today, the news in the Middle East is dominated by Tensions between Israel and Iran Factors that could affect supply and raise prices in particular are taking a back seat. Today, concerns about the U.S. economy outweigh “supply risks from heightened geopolitical tensions in the Middle East,” said John Prasad, an investment expert at Mirabaud.

more This situation is particularly volatile and unpredictablewhich could have a negative impact on oil prices overnight. Market watchers are closely watching Iran’s response to the assassination of Hamas political leader Ismail Haniyeh in Tehran.