Oil prices are falling like crazy. Is fuel about to be cheaper than WATER?

The markets don’t like it one bit

Markets around the world are squirming under the pressure of concerns about falling oil prices.

Brent crude oil dipped below $30 a barrel for the first time in nearly 12 years last night, rising to around $30.50 a barrel this morning.

Last night, the S&P 500 closed 10% down on its peak in November, after falling 2.5% during the day to 1,890 points – its lowest since September.

In Asia, “a negative feedback loop of self-perpetuating fear seems to have gripped global markets” causing shares to plummet, according to Angus Nicholson of IG. Markets in the continent fell to a three-year low – with Japan’s Nikkei at one point down 4%, though it recovered slightly to finish the day back by 2.7% or 474 points.

The pessimism of US and Asian markets was reflected in European listings when they opened this morning. The FTSE 100 dropped 1.2% or 73 points upon opening and other European indicators were down around 1.3%.

This is another bad day following a bad start to the year for the FTSE 100 – it has now lost 5.5% in a month.

Joe Brent from investment banker Liberum said: “In 2016, UK indices have suffered their worst start since 2008.

“There is plenty to worry about globally; China, emerging markets, commodity prices, monetary tightening, negative earnings momentum, high valuations and a tired looking bull market.”

Cheaper fuel? You bet!

RAC spokesman Simon Williams said the falling price could mean much lower prices for British motorists at the fuel pump. Parts of the UK have been experiencing prices below £1 a litre since before Christmas, and it looks as though this trend of falling prices will continue.

“With no apparent end in sight to the free-falling price of oil, motorists can expect some really low fuel prices in 2016,” Williams said.

“Breaking through the pound a litre price point for both petrol and diesel was clearly a welcome landmark, but it looks as though there is more to come.

“In fact we may get to a bizarre time when a litre of fuel is cheaper than a litre of some bottled waters.”

We live in hope.

 

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