Citing falling oil prices in world markets, leading oil company Statoil said it had cut the price of 95 octane lead-free petrol to 11.90 kronor, from 12.28.

“We are now generally back at the level we saw before Huricane Katrina hit New Orleans,” said Ulf Svahn, chief executive of the Swedish Petroleum Institute, the trade association for oil companies in Sweden.

The global oil market was now “more balanced, even if there is still a big refining capacity problem in the world”, he told the TT news agency.

Statoil spokeswoman Helena Fornstedt said last week’s oil and petrol price spikes had been due to fears that refining capacities were too limited, but since then several countries had made strategic oil reserves available.

The oil market remained nervous, however.

“If anything influences it negatively the market will react with price rises at lightning speed,” Fornstedt said.

The fall in Swedish petrol prices came a week after record highs for crude oil were set in the wake of Hurricane Katrina, which pushed prices to 70.85 dollars per barrel in New York on August 30.

On Tuesday, October light sweet crude stood at 63.31 dollars in New York, and October Brent North Sea crude at 61.73 dollars in London.

AFP