Brent type barrel is traded for US$ 83 and WTI operates at US$ 79 with expectations of a ceasefire in Gaza and high stocks in the USA
Oil prices have been falling since Wednesday (May 1, 2024) amid market expectations of a ceasefire in the Gaza Strip with a truce between Israel and Hamas.
A Brent barrel, an international reference, closed at around US$83 on the holiday and operates at the same level this Thursday (May 2). It is the lowest level in 7 weeks.
A barrel of WTI (West Texas Intermediate) oil, a reference in the United States, has been operating below US$80 since Wednesday. This Thursday, it reached US$78. It is the lowest value in 11 weeks.
In addition to the expectation of a truce in Gaza, high oil stocks in the USA contribute to the drop.
On Wednesday, US Secretary of State Antony Blinken said that “now is the time” of Israel and Hamas reach a ceasefire. Aconfirmed that there is an agreement on the table.
The American met in Israel with the country’s president, Isaac Herzog, and the Israeli prime minister, Benjamin Netanyahu. He said that the Joe Biden government (Democratic Party) is “determined to achieve a ceasefire” in the Palestinian enclave.
On the same day, the United States Department of Energy announced that oil stocks in the country grew by 7.2 million barrels, well above the expectation of a decline of 1.5 million barrels. Abundant supply at a time of stable demand directly affects prices.
FUEL LAG FALLS
The drop in oil prices reduced the fuel gap in the Brazilian market. This Wednesday, the sales value of Petrobras gasoline is R$0.35 lower than the PPI (Import Parity Price), an average difference of 11%. The percentage reached 24% on April 17.
In the case of diesel oil, the difference compared to the international price is R$0.15, 4%. The data comes from the daily monitoring report of the Abicom (Brazilian Association of Fuel Importers). Here is the full survey (PDF – 427 kB).
Petrobras has not yet made any adjustment to fuels in 2024. The last adjustment to Petrobras’ fuels was more than 4 months ago, in December 2023, when it reduced the price of diesel by R$0.30 per liter for distributors and the value increased to R$ 3.48. In the case of gasoline, the last change was on October 21st, when there was a reduction of R$0.12 per liter.
Although Petrobras abandoned the PPI as a pricing policy, starting to give more weight to internal costs, the oil price and exchange rate still have an influence on prices. This is because 25% of the diesel consumed in Brazil is imported, as is 15% of gasoline. This purchase abroad is made at the PPI price.
