REMEMBER the time when RON95 and RON97 dipped to the sub-RM1.30/litre and sub-RM1.60/litre level respectively during the peak of the movement control order (MCO)?
In fact, for the period from Apr 11 to May 15, both RON95 and RON97 went even lower to RM1.25/litre and RM1.55/litre respectively in tandem with the massive decline in global oil prices.
To re-cap, that good time coincided with the freefall of Brent crude price – the benchmark for global oil prices – which nosedived almost 71% to a low of US$19.33/barrel on April 21 after having started 2020 at US$66.25/barrel.
Ironically, for many car owners, the fall in oil prices back then served little – if not, no purpose at all – given lockdowns and travel restrictions meant driving is limited to running errands within a 10km radius.
Such is the situation from Mar 18 when the MCO was first imposed to end-June when the less stringent conditional MCO (CMCO) and eventually the recovery MCO (RMCO) came to place.
Following the recovery of global oil prices, the prices of RON95 and RON97 have moved upward to settle at the current level of RM1.78/litre and RM2.08/litre respectively for the week of Dec 19-25, the highest since RM1.82/litre (RON95) and RM2.10 (RON97) for the week of Mar 14-20.
Year-to-date, the highest price for both RON95 and RON97 is RM2.08/litre and RM2.65/litre respectively while the lowest was RM1.25/litre and RM1.55/litre respectively.
Reminiscing about the good old days of cheap oil price which many motorists could hardly take advantage of, it is surely sad to say those moments are unlikely to make a comeback anytime soon.
In its latest oil and gas outlook, TA Securities Research maintained an “overweight” recommendation of the sector with oil price assumptions of US$45/barrel in 2020 (current: US$52/barrel; YTD: US$43/barrel; EIA forecast: US$41/barrel; Bloomberg Consensus Median: US$43/bbl).
For 2021, it raised its assumption to US$50/barrel (EIA forecast: USD48/barrel, Bloomberg Consensus Median: US$48/barrel).
Well, looking into the near future, perhaps it can be assumed that so long as Brent crude price hovers above the US$50/barrel mark, the price of RON95 and RON97 will probably stay above RM1.70/litre and RM2/litre respectively.
At the time of writing, Brent crude is trading at US$50.61/barrel, down US$1.65 or 3.16%. – Dec 21, 2020
