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THE WORLD HAS entered a “new era” of oil use in which supply will outstrip demand, according to one industry analyst.
The price of crude oil dropped 9% last month after a September report from the International Energy Agency predicted lower global demand both this year and the next.
It hit a low of $83.78 (€67.11 at today’s rates) per barrel last month for Brent crude oil, which is used as the benchmark for about two thirds of the world’s internationally traded supplies.
The price has dropped further since the start of November and is currently sitting over 25% below the going rate from June.
Bord Gáis energy trader John Heffernan said despite ongoing turmoil in the Middle East, there had been a “flood” of supplying coming from countries outside OPEC – a consortium of the biggest oil suppliers including nations like Iran, Iraq, Kuwait, Saudi Arabia and Venezuela.
“The fall reflects the reality of a new era in world oil with global oil supply growth outstripping demand,” he said.
“In response to surplus supplies and a shrinking market, key producers such as Saudi Arabia and Iran reportedly slashed prices to defend market share.”
What will the big oil producers do now?
Heffernan said the question was how OPEC would respond to the price drop, either cutting production to boost prices or accepting the new, lower prices in a bid to compete.
In recent years, the US has dramatically increased its production of “light tight oil”, also known as shale oil, which is produced with the same “fracking” techniques used in shale gas production.
That output boost, combined with the lower global demand, has made consumer countries less dependent on the once-dominant OPEC alliance.
Bord Gáis’s Energy Index, which measures the overall cost of wholesale energy supply, dropped 5% last month as the big decrease in oil prices was partially offset by more expensive natural gas, coal and electricity.
So will it get cheaper to fill up the car then?
Sadly, the cheaper wholesale prices will make little immediate dent in the cost of filling up the car as any savings take a while to filter down the production chain and nearly 60% of retail petrol and diesel prices go straight to the government in taxes.
Since June, the euro has also fallen nearly 10% against the US dollar which has eaten up some of the drop in oil prices.
The average petrol price was €1.54/litre last month, down from €1.57/litre in July but still above rates from early in the year.
Prices peaked at €1.70/litre in September 2012 after global oil prices hit a 150-year high the previous year.
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Great to see. Good luck to all.
Just back from the local after a nice quart. It’s the simple things in life….
Best of luck to them, after all the county was placed under level 3, nearly 78 days ago.. Here’s hoping they arent shut down in again in 30 days
Covid back with a vengeance in a few weeks then.
@David Connell: OMG!!!
@David Connell: Looking forward to the new year?
@David Connell: Give over with your baseless accusations. Have you been to any pubs and seen the controls they have in place?
If people stick to the guidelines within pubs and restaurants it shouldn’t be a problem.
I’d be more worried about house parties then I would pubs or restaurants.
I will stick to my takeaway pints ,I’m a miserable git and refuse to buy chicken wings or a burger and chips.
Great to see. Delighted dome Great pubs in the village around Grafton Street open for punters. Pity the best little pub.. Peters.. couldn’t open.. hopefully in the new year.
@Mark O’Brien: Peters is open Mark
@Dave Murphy: is it? I thought soup and sandwich bars couldn’t open.. I’ll b in there tomorrow then!
@Mark O’Brien: We’ve added some extra things to menu, we were open for 6 weeks during the outside dining only so Garda were happy that what we were offering was enough so we’re going ahead
@Mark O’Brien: nasty
Anyone who drinks in them pubs and especially temple bar as that reporter did deserves to be ripped off u wouldn’t catch me in any of thoses pubs named even on a cold wintry day in Dublin
@liam ward60: Not all pubs are aimed at the same people, if you don’t like them that’s grand but there are plenty of people that do and happily spend the money in them. Personally I enjoy the bankers and the Swan of the ones mentioned but I have been in all the others. Its the joy of choice, if you don’t want to go there don’t, but why give out about them if it doesn’t affect you?
Can you order a non alcoholic drink without buying food?
@Ann Basquille Smith: Yes but with limited seating in pubs you’ll probably find that most places will not give you too long seating with that little spend to turn over the tables.
@Ann Basquille Smith: yes you can
A pint of zero alcohol lager was the same price as an alcoholic one before Covid19.
@Ann Basquille Smith: Non alcoholic beer is more expensive to make than alcoholic beer, well if they want it to taste anything like beer.
@Ciaran: Tom Selleck would be so proud Ciaran
@Ciaran: Don’t have a sister so have to take your word on it
@Dave Murphy: no duty on it though !
Let me dafuq in there!!
only gastropubs open .best pubs ant.misleading article
I’m drunk right now
Once again the journal grabs us in by false headlines.
Does anyone know if odonaghues is open? It said on publin they are serving takeouts? Handy to know?
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