TALLINN, Dec. 19 (Reuters) — Fuel prices in Estonia are set to fall by an additional five cents per liter due to a drop in global oil prices and the ongoing trade conflict between the U.S. and China.
Over the past week, global oil prices have dropped by 16%. While gas stations have not yet fully reflected this decline, fuel retailers confirm that further price reductions are imminent.
“The price has already dropped by about 3.5 cents,” said Kert Aader, motor fuels category manager at Circle K. “We cannot predict the direction of the global market with certainty. If there are major shifts in U.S. President Trump’s statements, prices could rise again. But if global prices continue to fall, gas station prices will follow suit.”
Alan Vaht, a board member at Terminal, responded to criticism that fuel retailers are slow to adjust prices. He argued that this perception is inaccurate. “If we look at the trends over the last 30 days, fuel prices at gas stations have been slower to drop than global market prices, lagging by up to 8 cents,” Vaht said. “Given the latest decline in the global market, gasoline prices could reach around €1.55 per liter.” As of Wednesday, the price of 95-octane gasoline was €1.61 per liter.
Despite the drop in global crude oil prices to levels not seen in four years, gasoline and diesel prices at Estonian gas stations remain 23 and 27 cents per liter higher than they were at that time.
Vaht explained that several factors contribute to this difference. “The global market price for gasoline has not decreased as much,” he said. “Additionally, VAT has increased from 20% to 22% over the past four years. Last year, the excise duty on diesel fuel was also raised.”
The ongoing trade war between the U.S. and China is reducing global demand for oil, while OPEC+ countries have committed to increasing oil production. Together, these factors are pushing oil prices lower, according to Lenno Uusküla, chief economist at Luminor.
However, Uusküla cautioned that U.S. oil companies may struggle to sustain production at current price levels in the long term. “This conflicts with Trump’s desire for the U.S. to increase oil production. As a result, the long-term price range for oil may be higher than the current level. But in an uncertain world, we can expect fluctuations,” Uusküla said.
He added that much depends on the actions of President Trump in the coming months.
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