Weekly petrol prices
Retail petrol: According to the Australian Institute of Petroleum, the national average Australian price of unleaded petrol rose by 1.0 cent per litre to 120.9 cents per litre in the week to October 16. Prices rose in all capital cities except Melbourne last week.
Regional petrol: Last week the key Singapore gasoline price rose by US$1.60 or 2.6 per cent to a 12-month high of US$63.80 a barrel. In Australian dollar terms the Singapore gasoline price rose by $2.01 a barrel or 2.5 per cent to an 11-month high of $84.15 a barrel or 52.92 cents a litre.
What does it all mean?
A year ago the national average petrol price was $1.28 a litre. Today, it stands at $1.21 a litre. But the key Singapore gasoline price has lifted to 12-month highs on expectations that major oil producers will crimp production. So motorists need to brace for pump prices edging another 3-4 cents a litre higher. Still, the stronger currency should ensure that prices hold below the levels of a year ago.
Petrol is the single biggest weekly purchase that most families make. So petrol has a big impact on retail spending. In addition, across the globe higher petrol or gasoline prices create a risk for inflation and thus interest rates. Over the last two months, the cost of filling a car with petrol in Australia has lifted by around $6. The good news is that the stronger currency has kept pump prices below recent highs set in June.
It’s not just motorists that need to stay alert to higher petrol prices. Higher unleaded and diesel prices create the potential for upward pressure on food prices, given the high transport component of perishable food costs. And airline passengers also need to be alert to higher airfares. The cost of jet fuel hit 15-month highs last week and prices stand 76 per cent higher than levels set in mid-January this year.
What do the figures show?
Petrol prices
According to the Australian Institute of Petroleum, the national average Australian price of unleaded petrol rose by 1.0 cents per litre to 120.9 cents per litre in the week to October 16. The metropolitan petrol price was unchanged at 119.6 cents per litre while the regional price rose by 2.9 cents to 123.4 cents per litre.
Average unleaded petrol prices across states and territories over the past week were: Sydney (up by 1.3 cents to 118.0 c/l), Melbourne (down by 5.4 cents to 120.8 c/l), Brisbane (up 4.8 cents to 126.4 c/l), Adelaide (up by 0.7 cents to 115.5 c/l), Perth (up by 0.4 cents to 112.1 c/l), Darwin (up by 5.3 cents to 114.1 c/l), Canberra (up by 5.2 cents to 123.7 c/l) and Hobart (up by 1.4 cents to 122.0 c/l).
The national average Australian price of diesel petrol was up by 2.0 cents to 119.9 cents per litre in the week to October 16. The metropolitan price rose by 2.2 cents to 119.7 c/l, while the regional average price was up by 1.8 cents to 120.1 c/l.
Today the national average wholesale (terminal gate) unleaded petrol price stands at 110.8 cents a litre, up 2.1 cents a litre over the week. The terminal gate diesel price stands at 110.4 cents a litre, up by 2.8 cents a litre over the previous week.
Last week the key Singapore gasoline price rose by US$1.60 or 2.6 per cent to a 12-month high of US$63.80 a barrel. In Australian dollar terms the Singapore gasoline price rose by $2.01 a barrel or 2.5 per cent to an 11- month high of $84.15 a barrel or 52.92 cents a litre.
MotorMouth records the following retail prices for capital cities today: Sydney 126.4c; Melbourne 117.3c; Brisbane 123.0c; Adelaide 127.7c; Perth 105.2c; Canberra 128.6c; Darwin 119.1c; Hobart 123.2c.
In the September quarter Australian petrol prices fell by between 2-3 per cent after lifting 5.9 per cent in the June quarter. As such, lower petrol prices are keeping downward pressure on the overall inflation rate. What is the importance of the economic data?
Weekly figures on petrol prices are compiled by ORIMA Research on behalf of the Australian Institute of Petroleum (AIP). National average retail prices are calculated as the weighted average of each State/Territory’s metropolitan and non-metropolitan retail petrol prices, with the weights based on the number of registered petrol vehicles in each of these regions. AIP data for retail petrol prices is based on available market data supplied by MotorMouth.
What are the implications for interest rates and investors?
If the oil price continues to lift it will provide an inflationary pulse through major economies. To some extent this would be welcomed by central banks. Simply, a little inflation is a ‘good news’ event as it could signal to consumer and businesses that ‘normality’ is returning, also given central banks scope to return to ‘more normal’ rate settings.
Retailers and other consumer-focussed firms could face more challenging conditions if transport costs lift.
Extracted from The Bull.
