“We hope that the news about progress in the negotiations between the US and Iran in Switzerland will be good“. This was said on the air of “Your Day” on NOVA NEWS by the chairman of the Bulgarian Oil and Gas Association, Svetoslav Benchev.
He emphasized that the oil market reacted to this news. “The other day the price per barrel rose slightly and reached about 80 dollars per barrel, and today it has again fallen below this level - to about 78-79 dollars per barrel. The market believes that something positive will happen in the coming days“, added Benchev.
When asked to which periods these levels can be compared, he recalled that at the beginning of the crisis prices were around 65-69 dollars per barrel. “We are still well above the levels from before the start of this adventure in the Middle East“, he emphasized.
With regard to fuels in our country, it is expected that if the current oil levels are maintained, there may be an additional decrease in price, although without specific forecasts by how much. “It is good to see where oil will anchor itself in terms of value for the coming weeks“, Benchev is categorical. According to him, it is unlikely that we will soon return to the levels of around $65 per barrel observed before the conflict.
Regarding the dynamics of the market, he commented that prices will probably remain in the current range, as it reflects the current geopolitical situation and the moderate optimism of the markets. “My assumption is that things will remain in this range that we are currently seeing“, said Benchev.
Regarding fuel prices in Bulgaria, he noted that diesel has fallen in price by around 12 percent in the last month. “More importantly, there is no growth, but rather a calming of the market”, he commented. And he recalled that in the previous period, levels of 111-118 dollars per barrel and significantly higher fuel prices were reached in our country, including diesel around 1.78-1.80 euros.
He also reported a decrease in gasoline to average levels of around 1.49-1.50 euros, which, according to him, shows that the domestic market is following international trends, albeit with some delay.
Regarding the recovery of the market, he explained that everything depends on developments around the Strait of Hormuz: “If everything ends with an agreement in the next 30-40 days, if the strait is opened and demined, it will take time until the end of the year for the situation to normalize“.
However, Benchev warned that there will probably be additional costs for insurers and carriers in the form of risk premiums, which could keep prices above previous levels. conflict.
In a worse scenario, if the negotiations fail or tensions escalate, a new shortage in the market and a sharp increase in prices are expected. “If we do not resolve the situation in the coming weeks and the strait is closed, serious uncertainty will be created“, the expert is categorical.
The situation remains dynamic and highly dependent on the course of the negotiations, with the final effect on fuel prices in our country depending on whether geopolitical tensions stabilize or escalate again.