Fuel prices ease, providing some welcome relief!
Originally uploaded on October 21, 2022
Crude oil prices had a strong start to October as reported in our more recent blogs. However, the return of the global recession concerns, which have been rising throughout the year, as well as an expected announcement of another Strategic Petroleum Reserve (SPR) release by the Biden administration has weighed on price action in recent days. This has halted the upward trend, which is welcome news for us all!
While many, if not all, global recession concerns are largely priced in, the news at the start of the week that China would be delaying the release of their 3Q’22 GDP report has led investors to believe that the world’s second-largest economy is facing a more difficult situation than previously envisioned. And so, the choppy price action has continued for crude oil prices, leaving the market in a technically ambiguous area.
The unpredictability of future market movements is due to tight supply concerns being offset by weak global economic data and the geopolitical landscape, which continues to remain uncertain. For the UK in particular, politics remain highly embarrassing, following this week’s ongoing turmoil in Westminster.
Retail prices have started to rise, with diesel now exceeding £1.91 pence per litre in most areas, as they play catch up to the recent increase in the wholesale cost of fuel. For fuel card users, a welcome drop in the region of 1-2 pence per litre can be expected as we move into the final week of October.