Financial and business news from Bulgaria

Fuel prices in our country may fall, but in no case by 30%

“The main reason for the fall in oil prices is that OPEC could not agree with Russia on reducing yields. This happened on Friday, and on Monday, black gold prices plunged to these long-unseen values” values. This was said on the air of “Plus-Minus” on Nova TV the executive director of the Petroleum and Gas Association Andrey Delchev.
“Saudi Arabia has announced that it will increase oil production by about 300,000 barrels per day, which is a lot. The Russian side also said it would most likely increase it. This time, instead of a single platform in terms of prices between OPEC and Russia, the fight for markets and customers has led to the current situation. That every oil producer loses is perfectly clear,” he added.

Delchev explained that Russia is losing about $150m a day because they are the second largest producer of crude oil. In Saudi Arabia, the losses were even more.

“Analysts say in close terms, the US will take the first place in the world's crude oil production. Shale producers could also suffer, but they have been shown to be flexible enough in this regard. They close the boreholes and, when prices are again acceptable, they open them up. Prior to OPEC's last meeting, supply was exceeding demand, a major factor in lowering prices. The coronavirus also appeared, which also works in this direction,” Delchev said.

He also commented on possible reductions in fuel prices in Bulgaria. “They can drop, but in no case by 30% as much as the drop in oil. Fuel goes a long way from the refinery to the end user. In this regard, the trends in Bulgaria are the same as those in Europe, and for various reasons the fuels in Bulgaria are some of the cheapest on the continent”, Delchev concluded.

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