European motorists eyeing the bear market in crude oil are going to be disappointed at the pump.
Brent, the benchmark crude oil, slumped 21 percent since May 6, meeting the common definition of a bear market. For the first time in at least a decade, the milestone has yet to be accompanied by a slide in retail gasoline. In fact, prices rose slightly over the same period, European Commission data show.
Energy analysts are pinning the blame on a stronger U.S. economy, saying it’s pulling more cargoes of the fuel than normal across the Atlantic in America’s driving season. European prices normally fall when crude oil has big declines, as this graphic shows.
“The lower oil price has created a lot of anger and frustration amongst drivers as they are not seeing those downward moves reciprocated at the pumps,” Luke Bosdet, spokesman for the AA, the U.K.’s biggest motoring organization, said by phone. “We are anticipating a traditional track for petrol where the end of the U.S. summer driving season sees demand drop off and prices fall with it.”
The U.S. economy will grow 2.3 percent this year compared with a European expansion of 1.5 percent, according to economists’ estimates compiled by Bloomberg. Americans drove 1.26 trillion miles in the first five months of the year, the most ever for that period, according to Federal Highway Administration data.
The number of cargoes booked or anticipated to carry oil products from Europe to the U.S. East Coast is set to climb to the highest in five weeks, according to a Bloomberg survey of shipbrokers who monitor the trade.
The situation is better for those with diesel-powered cars. The fuel has tracked crude lower in Europe, amid signs that supplies from Russia, the U.S. and the Middle East keeping the market amply supplied.