The expert after the oil crash: "The price cuts are coming"

Since last Friday, the price of Brent oil has fallen by almost 20 percent to 96 dollars a barrel. A large part of the decline came during Wednesday when it became clear that the Democrats are taking over power in the US Congress, which caused the price of oil to fall around 9 percent.

- The Democrats have been against the war in Iran since the conflict broke out. So when they won, it increased the hope that the war can end faster than it looked like before the election, says Nordea oil analyst Thina Saltvedt.

It is the first time since the beginning of October that Brent oil has traded below $100 per barrel since the decline took off on Monday. This after Iran's supreme leader gave the government authority to conduct peace talks and that US President Donald Trump stated that the country will wait with attacks on Iran.

- How the oil price develops in the future depends on whether there will be new negotiations between the US and Iran. But it is at least a short-term breathing break for the market until we know more about the negotiations, says Thina Saltvedt.

Even Christian Kopfer, commodity analyst at Arctic Securities, emphasizes that the fall in oil prices is mainly due to expectations.

- It is still the case that there is an undersupply of oil, this price drop only reflects an increased hope, but there is nothing tangible to show that a peace settlement is actually close. At the same time, it must be remembered that once an agreement is in place, it will take some time before there is actually peace and that the oil stocks are fully restored, he says and continues:

- So it will take a long time before the oil price is back at 50-60 dollars as it was before the war.

Earlier this week, the list prices of petrol for business customers at OKQ8 were reduced by 95 öre to 16.29 kroner and diesel was reduced by 75 öre to 22.44 kroner. In the near term, Christian Kopfer expects that prices will be further reduced after this week's oil crash.

- It will affect fuel prices directly, it usually takes a few days before the price reductions come. At the same time, prices have risen further as a result of Ukraine sabotaging critical oil infrastructure in Russia, so there are several factors affecting fuel prices right now.

At the same time, Thina Saltvedt warns that fuel prices will not fall as much as oil has fallen.

- Almost as much crude oil comes out of the Strait of Hormuz now as before the war broke out. However, significantly less oil products such as petrol and diesel still arrive. Now we are also entering a period when a lot of diesel is used for heating, which means that the drop in fuel prices may be less now, even though the price of crude oil is falling significantly, she says.