Motorists will have noticed that prices at the pump are falling drastically at the moment. Fuels are returning to prices from before the outbreak of the war in Ukraine. Good news for the wallet that should also last in 2025.
Fuel prices at their lowest
Fuel prices in France have been on a sharp downward trend since the beginning of the summer. According to the Ministry of Ecological Transition, as of September 16, 2024, The average price of a liter of diesel was 1.59 euros. In fact, this is a threshold not reached since December 2021, just before the start of the war in Ukraine. Furthermore, the average price of SP95 E10 is 1.68 euros per liter, also far from the peaks of over 2 euros per liter. These levels are particularly notable because they follow a period marked by tensions at the pump. But above all, by an increasingly expensive item of expenditure for low-income households, dependent on their car to get to work.
Several factors contribute to this remarkable drop in pump prices. On the one hand, the gradual stabilization of international energy markets plays a key role. Indeed, inflation, long at critical levels, is experiencing a reduction, falling below the 2% mark in August 2024, according to INSEE. In fact, this economic improvement, although moderate, has impacts on the cost of raw materials. And in particular that of fuels.
A downward trend for 2025
The oil sector is also seeing a gradual recovery in global production, after months of restrictions. But above all, disruptions related to the pandemic as well as the war in Ukraine. Thus, the geopolitical situation has relatively calmed down, leading to an improvement in the availability of crude oil on global markets. Furthermore, the falling demand associated with this increased supply is therefore pushing fuel prices down. A situation that has been going on for several weeks already.
In addition, major players in the French distribution sector, such as Leclerc and Total, are stepping up their efforts to offer competitive prices. Leclerc, for example, is offering diesel for less than €1.50 at some stations, a trend that is gradually becoming more widespread nationwide. Fuels remain key products for mass distribution.
Is this decline in fuel prices sustainable? While some economists remain cautious about a continuation of this trend, current indicators are encouraging. On the one hand, the slowdown in inflation and the stabilization of global energy markets suggest that the decline could continue for a few more months. However, the situation remains dependent on many external factors, including the geopolitical situation. But also, whether or not Chinese growth will resume. Thus, the markets remain on the lookout.
