Fuel prices likely to surge in October: CAL Research

Monday, 25 September 2023 02:31 - - {{hitsCtrl.values.hits}}

As the world grapples with a complex interplay of factors affecting the energy market, CAL Research, predicts a substantial increase in fuel prices by an estimated Rs. 12-14 per litre in October 2023.

This forecast comes amidst a series of influential developments in the global oil industry.

CAL Research said the recent months have witnessed a noteworthy surge in global average prices of petrol and diesel, with increases ranging around 4-5% month-on-month (MoM). A significant contributor to this upward trend has been the remarkable 7.7% MoM increase in the average Brent oil prices.

The Brent benchmark’s role in influencing global fuel prices cannot be overstated. Key players in the oil industry, notably the OPEC+ alliance, have responded to market dynamics with production cuts. While this strategic move is aimed at ensuring long-term stability, it inevitably results in short-term spikes in fuel prices.

The combination of production cuts and seasonal demand surges as winter approaches has set the stage for a challenging period ahead. The implications of this surge in fuel prices extend far beyond individual consumers, impacting various sectors of the economy.

The surge in fuel prices can lead to higher prices for goods and services, affecting household budgets and potentially contributing to broader inflationary trends. In this dynamic and evolving landscape, the need for sustainable energy alternatives is brought into sharper focus.

Transportation costs are expected to face further pressure from the public, and businesses from logistics to manufacturing are likely to see an uptick in operational expenses while consumers are also urged to brace for increased costs at the pump.

Prudent planning and a renewed emphasis on sustainable energy solutions will be critical in ensuring economic resilience.