”The price of a barrel of oil is not exploding, that of diesel continues to increase insidiously. And this is mainly linked to the fact that there is a lack of refining capacity for diesel in Europe and that we lack heavy oil to make diesel,” explains Damien Ernst, who pessimistically refers to the date of the 5 february. It is indeed on this day that the embargo on Russian refined petroleum products will come into force (the ban on crude oil has been in place since December 5). The problems related to oil refining capacity in Europe will therefore be even greater from then on. “The world cannot do without Russian diesel at the moment, and with this embargo coming, I fear that the diesel market will tighten, that the price will go up significantly and that for months and months, we will find ourselves with a higher price than what we currently have,” says the energy specialist.
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“Everything will depend on the Russians”
But how much could diesel increase? “I don’t want to give a random figure,” replies Damien Ernst, before mentioning the factor that will be decisive in this probable increase: “All of this will depend on the latitudes of the Russians and the way in which they are going to to other places the diesel that they were sending to Europe or the United States. If Russia doesn’t do this, the price of diesel can go very, very high”. “There will just be a shortage of diesel and, much like we have seen with gas, the following phenomenon could take place: the price will rise sharply, to kill demand somewhat and then rebalance the markets”, continues -he.
For Damien Ernst, it is important – as far as possible – to anticipate this increase in the price of diesel. How ? “Faced with this risk, I advise people who have an oil boiler and who can, to play it safe by filling their boiler now, before the entry into force of the Russian embargo”.