The price of petrol is tumbling and set to fall further. Filling up at the pumps is getting cheaper throughout the eurozone thanks to the crash in oil prices.
The sudden price cuts in petrol represent a massive direct shot of stimulus that governments and central banks have for various reasons avoided.
Extra cash is now in the motorists pockets and could help slash costs in other industries potentially freeing up money firms can hold or pass on to customers in the form of cuts.
If you are filling up in the Netherlands then your petrol is the priciest in the eurozone at 1.565 euros but in Estonia you should be laughing it’s the cheapest at 0.963 euros.
The cost of a litre for diesel and petrol is affected by taxes and the rate of exchange as oil is priced in dollars.
More cuts could be on the way as oil prices continued their downward spiral. Benchmark Brent was down more than five percent to 47.44 dollars a barrel while US crude fell 4.6 percent to 46.13 dollars with short term forecasts by one leading investment house slashed as Gulf producers showed no signs of curbing output.
A slide in oil prices usually takes around 15 days to impact on the price at the pumps which in turn can start a price war on supermarket forecourts.
It may be a surprise windfall for households but initially the price cuts could prove deflationary as cheaper petrol cuts the cost of living. And for investors it’s uncertain how the market will go. “Nobody saw this coming and its logical to say from there that nobody knows what is going to happen next,” said one analyst.