October 1, 2022
The United States will release 1 million barrels of oil per day to contain the rise

Why are they cheaper in Brazil?

The price of fuel in Brazil has fallen, with successive announcements of cutbacks. How is that possible? Crude oil, which in the recent past drove gasoline up, has returned to the pre-war level of $90 a barrel in Ukraine, which should drive down prices for fuels such as gasoline and diesel in the country.

Why is oil cheaper? According to the experts they consulted UOLthe recent decline in oil is associated with a slowdown in the global economy, especially in the United States and China, as well as an increased supply of goods.

Global growth expectations are declining, with inflation and interest rates around the world, this reduces the demand for products. Since we already have the worst impact of the war in Russia and Ukraine, the focus is now on a slowdown in the global economy, which is causing the price of oil to drop, says Rodrigo Glatt, partner at GTI’s managing director.

Effects of the United States and China on the world: According to Paulo Dutra, professor of economics at FAAP, rising interest rates in the United States to try to contain the effects of the war on the country’s economy threatens to drive the world’s largest economy into recession, at a time when China is also slowing. .

It ended up developing a recessive process, especially with the slowdown in China. Dutra says the country consumes less energy, and therefore other inputs.

Is there more oil production? In addition, there is also an expectation that Iran will return to the international market in the near future, providing more oil and lowering the price.

The country has the third largest oil reserves in the world, according to data from the Organization of Petroleum Exporting Countries (OPEC), after only Venezuela and Saudi Arabia.

The cheapest oil in America: There is also an effort by the US government to lower energy and fuel prices in the country, which have risen with the war in Ukraine. The White House called the chief executives of seven oil companies to a meeting to discuss ways to increase production capacity and lower fuel prices.

Will oil keep the price lower? Oil, which crossed the $110 per barrel mark in March, at the start of the conflict in Ukraine, reached $93.15 a barrel two weeks ago.

Data from Reuters shows that futures for Brent crude, an international benchmark, closed at $96.72 a barrel, up $0.13.

According to Citi Bank, if a US recession does occur, the price of crude oil could drop to $65 per barrel by the end of this year and reach $45 by the end of 2023. Not unanimously. For Goldman Sachs, forecasts are that the price of a barrel will be above $100 by the end of this year.

What happens to the fuel in Brazil? According to UFRJ economics professor and Ineep researcher, Eduardo Costa Pinto, if the barrel of oil continues to fall, then fuel prices in Brazil should follow the decline.

With the recent decline in commodity prices, the Petrobras announced last week Third consecutive price reduction In less than a month.