The price for a litre of petrol in The Netherlands is the lowest it has been since 2016. As global demand for oil decreases, so does the price of a full tank at a filling station.

Due to a collapse in demand following the coronavirus outbreak, oil prices have dropped sharply in recent months. In the US, oil prices even dropped below zero for a short amount of time, when it became clear that storage for crude oil would run out.

Fuel prices are tracked by Statistics Netherlands (CBS). In April, the average price for a litre of fuel was reported at €1.47, the cheapest it has been since 2016. In addition, CBS reported that it was the “sharpest drop in motor fuel prices since 2008.”

“Prices could drop a little further, but a price below one euro is virtually impossible”, says Hans van Cleef, senior energy economist at ABN AMRO. “The fuel tax alone is about eighty cents per litre, and then VAT is added on top of that.”

When we will see prices going up again depends largely on how long coronavirus lockdown measures will be in place, and whether OPEC members and Russia are able to agree on limiting oil production to the extent which is necessary.

According to Van Cleef, the low price of oil in itself isn’t worrying: “for oil-importing countries it could even be a short-term gain.” If the price of oil remains this low for too long though, it could lead to fewer investments in oil, which in turn could lead to shortages when demand shoots back up.