But you shouldn't expect any dramatic price drops at Swedish gas stations - even if crude oil becomes cheaper.
A few kronor from the “bottom”
The prices of gasoline and diesel are currently around SEK 15.50 and SEK 16.70 per liter, respectively. That's only a few kronor from the "bottom," believes Christian Kopfer, commodities analyst at Handelsbanken.
"There's not much happening to fuel prices from here. It's at most – realistically – a couple of kronor if there were to be a real "war" for market share globally," he says.
Even if the price of oil were to go to zero, gasoline would cost 10–12 kronor. There are so many fixed fees and taxes. And it still costs money to get the products to the gas stations – and the gas stations and refineries should make some profit too, he adds.
The price of crude oil has fallen from a yearly high of $81.62 per barrel in January to $60 per barrel and is currently hovering around $64 per barrel.
The current downward trend follows a temporary upward push in global oil prices in the wake of the Trump administration's decision to impose new rounds of sanctions on major Russian oil companies Rosneft and Lukoil last week.
The increased oil production is driven by Saudi Arabia's ambition to increase its market share in the global oil market, where it has been pressured back in recent years by increased American oil production.
“A game for the galleries”
There may also be political motives, according to the Bloomberg news agency, ahead of Saudi Crown Prince Mohammed bin Salman's planned visit to the White House on November 18. US President Donald Trump has repeatedly urged the oil industry to increase production - to push down gasoline prices for American households and businesses.
But in reality, the Saudis want to put a damper on American oil producers with lower oil prices. They want to eliminate competition in the United States, says Kopfer about the production increase that is now expected.
This is a game for the galleries. They want to kill two birds with one stone. On the one hand, they make Trump happy by bringing down the price of oil. And at the same time, they reduce the strength of their competitors.
Joakim Goksör/TT
Facts: OPEC+ is expected to increase production
TT
This weekend's OPEC+ meeting – a video conference on Sunday, November 2 – is expected to result in a decision to increase oil production by 137,000 barrels of crude per day for the third consecutive month, according to a survey of oil traders conducted by Bloomberg.
Nine out of ten oil traders surveyed believe that the increase will be this size. The tenth expects it to be even more.
OPEC-plus – where Saudi Arabia and Russia are the heaviest players – has surprised the market this year by increasing production by 2.2 million barrels per day, a full year ahead of schedule.
The cartel is currently implementing a second production restriction of a total of 1.6 million barrels per day, although this is happening at a somewhat more subdued pace so far.
