Fuel prices have skyrocketed since the start of the war

BarcelonaThe rising price of oil as a consequence of the war in Iran This has quickly been passed on to fuel prices, which have skyrocketed in the last week. This is known as the rocket and feather effect, which states that when oil becomes more expensive, fuel prices rise rapidly, while when crude oil becomes cheaper, fuel prices fall slowly.

The numbers are clear. The average price of a liter of 95-octane gasoline in Catalonia was €1.486 on February 28, the day the conflict began. This Wednesday, the same liter of gasoline cost €1.56. That's an increase of almost 5%. In the case of diesel, the price increase has been even faster. A liter of diesel cost €1.433 on February 28, while by Wednesday it had already reached €1.544, a rise of 7.7%.

In the same period, the price of a barrel of Brent crude, the European benchmark, rose from $71.80 to $79.96, an increase of 11.36%. In other words, the rise in oil prices was immediately passed on to fuel prices, even though the refined oil and fuel sold were largely purchased before the start of the war and, therefore, before the price of oil skyrocketed. In fact, fuel prices were the first commodity to reflect the war, and transporters have already begun requesting assistance. As the war in Ukraine demonstrates, a rise in the price of oil and its derivatives has an immediate impact on inflation, as transport and logistics become more expensive, and consequently, the prices of all goods rise. Fuel prices had already been rising since January, but in March they skyrocketed as a result of the war. In fact, they have been rising for seven weeks, and the price war is deepening the trend reversal from the downward spiral that had led to a 3.5% drop in gasoline prices and more than a 5% drop in diesel prices since November. Now they have accumulated increases of 2.15% and 2.6%, respectively, according to data from the EU Oil Bulletin

Despite the increase, filling an average 55-liter diesel tank costs €79.25, about €2.69 less than a year ago, when it cost around €81.95. As for gasoline vehicles, filling an average tank (55 liters) now costs around €81.73, about €4 less than a year ago, when it exceeded €85.74.

Electricity prices are skyrocketing

While fuel prices have risen, electricity prices have increased even more. The wholesale market price on February 27, the last working day before the war, was €20.1/MWh. This Thursday, the wholesale price stood at €90/MWh. This price increase will be felt most acutely by consumers with contracts in the regulated market, known as PVPC, or contracts referenced to the wholesale market.