While the public watches with bated breath what is unfolding in the Middle East after Iran's attack on Israel, analysts are sounding the alarm about the impending increases expected in the oil market, after it has already jumped above the 90 dollars a barrel, while there is concern that in a possible escalation of tension, then the barrier of 100 dollars may be broken worldwide.
While the last two months have seen an upward trend in fuel prices, climbing fifteen cents upwards, the assessment is that due to the tense situation, there may be another rise in prices in the near future. Something which the president of the Association of Stationers, Savvas Prokopiou, pointed out to the REPORTER, stating that, until Sunday, fuel prices were higher than in the previous period.
After such attacks, the normal development, added Mr. Prokopiou, “is to see price increases. In addition to the increase brought about by taxation and the gradual increase in prices worldwide, we expect further increases in the coming period due to the situation created in the Middle East. We hope, however, that the increases will be at lower levels and that fuel will not be greatly affected”.
As for the length of time it takes for the effects on fuel prices to show up, that seems to be a matter for the importing companies themselves. “Based on our experience, when there is a sharp increase in fuel, within fifteen days they are applied to the gas stations”, added the president of the Gas Stationers.
It is noted that when fuel prices increase at regular intervals, this is not to the benefit of the gas station owners, but on the contrary, they have a negative impact, as their cost to maintain stocks increases, resulting in the need for more capital. “When there is a sharp increase in prices, there are colleagues who cannot respond, since not everyone is in the same financial situation”, noted Mr. Prokopiou.
Another big headache for the gas station owners is the increasing flow to the occupied areas, since what has been observed is that when the price of fuel increases and the difference in fuel prices between the free areas and the occupied areas increases, the problem with the flows it grows and cannot be treated. “Unfortunately, it's something that doesn't seem to be resolved and we don't know what the situation will be in the future. In fact, after September if the green tax is implemented, it will be very difficult for fuel to return below 1.50 cents. Where we used to be able to say that the prices will be reduced, now we find it difficult to say that”, underlined Mr. Prokopiou.
Risk of exploitation is being reported consumers
On the other hand, consumers declare that any increase in various categories of products on the market is not justified, however, they estimate that there will be increases, as they believe that companies will take advantage of the situation in the Middle East, which they will present as an alibi to make more profits.
According to the president of the Consumers' Association, Marios Drousiotis, “there is that part of the merchants, who are looking for an excuse and an excuse to raise their prices higher than where they are, due to the philosophy and tactics that are always followed, when there is a phenomenon that affects the whole community”.
When it comes to fuel, consumers also estimate that it will not increase due to the tense situation in the Middle East . “I personally don't see it going to $100 a barrel because if it was going up, it would have gone up by now. The only case for the price to rise is a more general conflict, where Iran will not be able to supply oil if they are sanctioned. Iran produces five million barrels per day and if it leaves the market, the rest of the countries have the reserve to cover the difference, but it is not in their interest for the price of oil to rise,” explained Mr. Drousiotis.
