The Courier & Advertiser (Fife Edition)
Oil war prompts fuel price drop for drivers at pumps
Asda announces 2p per litre cut amid fallout between Saudi Arabia and Russia
Supermarket Asda has announced a price cut of 2p per litre (ppl) for petrol and diesel amid an oil war between Saudi Arabia and Russia which led to stock markets and oil prices tanking around the world.
Motorists filling up at an Asda forecourt will pay no more than 114.7ppl for petrol and 116.7ppl for diesel.
Asda said these are its lowest fuel prices since November 2017.
The retailer has brought fuel prices down by up to 11ppl since January.
Asda senior fuel buyer Dave Tyrer said: “Once again we’re pleased to be passing on wholesale cost reductions to customers.
“It will be a welcomed boost, especially to diesel drivers who are seeing some of the lowest fuel prices since 2017.”
AA fuel price spokesman Luke Bosdet said: “For the past two years, UK drivers have had to endure petrol averaging 125p a litre – 15p a litre higher than during the lows of 2015 and 2016.
“Now, at last, some real financial relief will flow from the pumps.
“However, there is currently a 6p, soon to be an 8p, gap between the UK average price of petrol and what competitive supermarkets like Asda charge for it.
“That’s a more than £4-a-tank difference between forecourts that have their customers’ interests at heart and those that don’t.”
As investors already deal with the fallout from coronavirus, Saudi Arabia announced plans to flood markets with extra supply – wiping billions off companies.
The Saudis are trying to punish Russia after the two sides failed to agree to supply targets.
Leaders will also be hoping it pushes US shale gas companies under, as their operations become economically unviable.
The move sent the price of a barrel of Brent Crude down 30% initially on Monday, before settling at around 20% down on a day earlier, to just 36.1 dollars a barrel.
Meanwhile, Saudi Arabia’s state-run oil giant Saudi Aramco said it would increase its crude oil production to 12.3 million barrels a day in April, a record amount.
The move seems to make good on the country’s promise over the weekend to increase output after Russia refused to cooperate on cutting production.
That led to a 25% plunge in the price of crude on Monday, the sharpest decline seen since the 1991 Gulf War.
International benchmark Brent crude
“Now, at last, some real financial relief will flow from the pumps. LUKE BOSDET, AA FUEL PRICE SPOKESMAN
traded up over 7% yesterday at nearly 37 US dollars a barrel.
In a filing made yesterday on Riyadh’s Tadawul stock market, Aramco, formally known as the Saudi Arabian Oil Co, said that the increase in production represented a rise of 300,000 barrels per day.
“The company has agreed with its customers to provide them with such volumes starting 1 April 2020,” it said in the filing.
“The company expects that this will have a positive, long-term financial effect.”
Saudi Aramco shares were up 9.7% in trading yesterday on the Tadawul to 30.95 riyals, or 8.25 US dollars, giving the world’s most-valuable company a valuation of 1.65 trillion dollars.
It came a day after Aramco shares collapsed by 10% and were pulled from trading for reaching the Tadawul’s maximum permitted loss in a day, dropping its valuation to 1.4 trillion dollars.
Aramco had offered only a sliver of its shares on the Tadawul for investors.
Aramco’s decision likely will flood global energy markets and put further pressure on prices.
The company had reached two trillion dollars in early days of trading in December.