The Organisation of the Petroleum Exporting Countries (OPEC) decided on Sunday to cut oil production by more than a million barrels a day, sending prices up to 85 dollars a barrel. The Estonian Oil Association (Eesti Õliühing) predicts that this price rise will soon reach Estonian gas stations. However, fuel retailer Neste is not so sure.
Oil prices on the world market reacted quickly to the OPEC decision on Sunday, but then stabilized following a six percent rise on Monday morning.
"The rise over the last couple of weeks has actually made up for the fall in mid-March, which was partly caused by the banking sector crisis moment. From there on, oil prices have recovered nice. However, they are still at levels comparable to where they were in January and February," commented SEB's private banking strategist Sander Danil.
Mart Raamat, head of the Estonian Oil Association, believes that the price increase will soon start to have an impact at Estonian gas stations.
"The last time the prices changed at our filling stations was on March 17, when they fell quite sharply. Since then, the world market price of gas has already gone up by ten percent and that has not yet been felt at our filling stations," Raamat said.
"So, by all accounts, we will still have to live with the higher prices. Last week, for example, prices for motor gasoline in Latvia and Lithuania went up, while in Estonia they stayed at the same level," explained Raamat.
However, Risto Sülluste, Neste Estonia's Marketing and Communications Manager, is not so sure an imminent price rise is on the cards.
"If the prices continue to rise, then it's simple math. Looking at the percentage price increase for oil this morning of around five percent, and it would mean adding around five cents to the final cost. But whether that materializes, when it does and by how much, we'll be able to tell in the next few days," said Sülluste.
However, he added that there are also other factors, which may help to prevent rising prices.
"A lot depends on internal competition, and on the positive side, we are moving away from diesel to summer fuel, which is cheaper than winter fuel. We hope that this will help to mitigate some of the price increases," he said.
Editor: Michael Cole