Dip in petrol prices, but expect more pain at the pump
The nation’s average petrol price dropped 3.9 cents to 178.6 cents a litre last week, according to Australian Institute of Petroleum data.
The national weekly average across the major cities fell by 7.4 cents to 176.6 cents per litre.
By contrast, the national average diesel price rose by 11.4 cents to 222.5 cents a litre.
Motorists who drive vehicles that use unleaded fuel are seeing a mix of prices across capital cities.
Prices in Canberra, Darwin, Hobart and Perth are creeping higher, but Sydney motorists are filling up at seemingly less-than-cost price.
Petrol prices could hit $2.15 a litre in coming weeks as capital cities return to the top of their fuel cycles and the return of an excise tax kicks in.
Cities on the east coast are nearing the bottom of their fuel cycles, meaning petrol prices will hit a floor before returning back up again.
Local markets in capital cities have put downward pressure on prices, says National Roads and Motorists Association (NRMA) media spokesperson Peter Khoury.
“In cities where the prices have either fallen into the bottom of the cycle or are still falling, now would be a good time to fill up,” he said.
Australians looking for the best fuel deal should shop around.
Consumers can use helpful apps – MotorMouth and Fueltrac – to find the best prices.
Australian Competition and Consumer Commission (ACCC) research shows these apps can help drivers save up to $520 annually on fuel.
Small, independent petrol stations are often cheaper than larger ones.
According to the ACCC, customers who only buy from small retailers can save about $350 a year.
Diesel on the up
Fueltrac CEO Geoff Trotter told The New Daily that the steep rise in the price of diesel is concerning.
“In Australia the biggest fuel usage, the most important fuel usage, is in mining, transport, agriculture, road transport trains. It’s not petrol, it’s diesel,” he said.
“There has been a huge demand in Europe for diesel because of Putin’s war. That forces the international price up in Singapore, which then flows into the Australian wholesale price, which has gone up about 8 cents a litre in the last couple of weeks.
“That’s the price shock that’s coming for the transport industry.”
The world could benefit from lower oil prices, CommSec chief economist Craig James says.
“One day the oil market is fretting that the global economy is headed for recession as central banks are aggressively lifting rates to quell inflation,” he said.
“On the next day, oil prices are being supported by attempts by OPEC+ producers to restrict production quotas.”
The recent decision by the Organisation of the Petroleum Exporting Countries Plus (OPEC+) to slash oil output is expected to increase prices.
A fortnight ago, OPEC+ said it would cut production by two million barrels a day.
The group claimed it was slashing production in case demand for oil slowed.
Governments worldwide are releasing stocks from strategic oil reserves to push down prices and tame inflation. Still, the OPEC+ cuts will work against that.
Joaquin Vespignani, an associate professor of the Tasmanian School of Business and Economics, told The Guardian that OPEC+ was “trying to squeeze the market for its last big profit”.
“They know the market is moving away from oil and that’s why they’re going to cut production to keep prices high for as long as they can, basically,” Associate Professor Vespignani said.
“There is a tension between short-term gains and long-term pain. They want to squeeze for more profits, but if the price is high the transition to renewables will be faster.”