Oil prices fluctuated wildly in 2022, rising on limited supply due to the conflict in Ukraine, then sliding on weaker demand from top importer China and the concern about a slowing economy. However, oil prices ended the year 2022 with a second consecutive yearly increase.
The Russian invasion of Ukraine disrupted global crude flows in March, causing prices to soar. International benchmark Brent reached USD 139.13 per barrel, the highest level since 2008. The second half saw a sharp decline in prices as central banks raised interest rates and stoked recessionary fears.
On the last trading day of the year 2022, Brent crude finished at USD 85.91 per barrel, up over 3% to USD 2.45. US West Texas Intermediate crude increased USD 1.86 or 2.4% to settle at USD 80.26 per barrel.
After increasing by roughly 10% in 2021, Brent increased by 50% in 2022. Following a gain of 55% the previous year, US crude increased by roughly 7% in 2022. The year 2020 saw a substantial decline in both benchmarks as the COVID-19 pandemic reduced fuel usage.
Brazil’s Lula Decrees Extension For Tax Exemption On Fuels
Luiz Inacio Lula da Silva, Brazil’s recently sworn-in president, issued a decree extending for 60 days an exemption for fuels from federal taxes, a move passed by his predecessor with the intention of bringing down their cost.
The decree was one of Lula’s first actions as president, replacing far-right President Jair Bolsonaro and formally appointing his 37-person Cabinet, which he announced in the hours following his inauguration.
Fuel exempt from federal taxes will save the federal government 52.9 billion reais annually. Economy Minister Fernando Haddad had previously stated that it would not be extended, creating a division in the new Cabinet.
On the other hand, the new CEO of Brazil’s state-run oil corporation Petrobras announced that he intended to change the nation’s fuel price policy, but assured investors that they shouldn’t be concerned.