PPI continued to rise
The Producer Price Index (PPI) rose by 0.4 per cent from January to February. Higher prices on crude oil and refined petroleum products contributed strongly to pull the PPI upwards. The price index of electricity went in the opposite direction.
The price index of extraction of oil and natural gas increased by 1.2 per cent from January to February. While the price of natural gas fell in February, the oil price went up by 8.7 per cent, according to new figures from the Producer price index. Reduced oil supply due to production cuts from the OPEC-countries was the main reason behind higher oil price. Production cuts are announced to continue throughout 2019. In addition, OPEC warns increased demand of oil in 2019. Conditions in both the supply and demand side can thus further strengthen the oil price.
Figure 1. Price indices. 2015=100
|Crude oil||Total PPI||Refined petroleum products|
An important contribution in curbing the rise in the PPI came from electricity, which fell by 5.5 per cent from January to February. From January 2019 the distribution network tariff is included in the price index of electricity. Production and distribution is published as a total index for electricity supply in the domestic market, while the system price from Nord Pool is used for the export market. From January to February, the domestic price on electricity including distribution fell by 4.5 per cent, while export prices, which does not include distribution, fell by 15 per cent.
Higher prices within manufacturing
Manufacturing prices rose by 1 per cent from January to February, largely due to the rise in prices within the refining industry. Without this industry, the total manufacturing prices increased by 0,3 per cent.
Another industry with a reduction in prices from January to February was services related to mining and quarrying. From February 2018 to February 2019, prices went down 12 per cent within this industry.