Wholesale unleaded petrol prices hit 13-month high
Petrol Prices; Used vehicle market

Fuel prices: Last week the national average price of unleaded petrol fell by 1.7 cents a litre to 138.5 cents per litre (c/l) according to the Australian Institute of Petroleum. Retail unleaded pump prices are easing in Sydney and Melbourne due to discounting cycles, but prices have hit $1.70 a litre in Brisbane suburbs.

Wholesale unleaded petrol prices: Today, the national average unleaded Terminal Gate Price (TGP) stands at a 13-month high of 127.2 cents a litre, up by 2.4 cents over the week.

Used car prices: Used vehicle prices fell 1.9 per cent last week with supply down 4 per cent.

Movements in the petrol price can affect consumer spending, and in turn, prospects for retailers. Used car price data is useful in gauging activity levels in the motor vehicle market.

What does it all mean?

• The fuel price hike cycle is underway in Brisbane. Servos clustered around the city’s inner northern and western suburbs are today charging motorists 169.9 cents a litre for unleaded petrol. But MotorMouth reports that the average retail unleaded petrol price is 134.6 cents a litre across Greater Brisbane, so motorists should only fill up at these levels or top-up their fuel tanks until prices ease further.

• Petrol prices in Sydney are easing at a glacial pace. Average retail unleaded fuel prices are down 15.1 cents a litre to 137.6 cents a litre over the past fortnight with the retail discounting cycle underway. Prices are still above 142 cents a litre in large swathes of the city, but drivers battling the torrential rain in Sydney’s western suburbs can fill up for below 126.9 cents a litre. With the current discounting cycle now two weeks old, the next price hike is due ahead of the Easter long weekend, so motorists should continue to monitor fuel prices ahead of school holiday road trips.

• Melbourne retail unleaded petrol prices are averaging 136.1 cents a litre today, but prices are below 127.9 cents a litre in the city’s south-western suburbs. With pump prices likely to ease further, motorists should fill up ahead of the Easter holiday break.

• Elsewhere, fuel prices are beginning to lift in the less competitive smaller capital city fuel markets of Canberra, Darwin and Hobart. Average retail unleaded petrol prices hit 12-month highs today in all three cities, ranging between 135.2 cents a litre and 141.5 cents a litre. And national regional unleaded petrol prices climbed 1.7 cents to 136.9 cents a litre last week with fuel supplies likely to come under pressure on the NSW mid and northern coasts amid flooding.

• Used car prices fell 1.9 per cent last week with ex-lease vehicle prices down 3.6 per cent. Stock, however, remains low with the market tightening a further 4 per cent last week. Prices of used Subaru Forester (up 3.5 per cent) and the Hyundai i30 (up 2.1 per cent) rose most. But the prices of in-demand recreational utes – the Holden Colorado (down 5 per cent) and Ford Ranger (down 3.8 per cent) – fell most.

What do you need to know?

Weekly petrol prices

• Last week the national average price of unleaded petrol fell by 1.7 cents a litre to 138.5 cents per litre (c/l) according to the Australian Institute of Petroleum. Metropolitan prices fell by 3.5 cents to 139.2 c/l, but regional prices rose by 1.7 cents to 136.9 c/l.

• Average unleaded petrol prices across states and territories over the past week were: Sydney (-8.7 cents to 140.5 c/l), Melbourne (-12.3 cents to 140.4 c/l), Brisbane (-1.3 cents to 131.3 c/l), Adelaide (+23.8 cents to 151.3 c/l), Perth (+2.3 cents to 138.4 c/l), Darwin (+1.9 cents to 133.9 c/l), Canberra (+2.0 cents to 139.0 c/l) and Hobart (+3.1 cents to 140.5 c/l).

• The smoothed gross retail margin (2-month rolling average) for unleaded petrol fell from 17.08 cents per litre to 15.89 cents a litre (24-month average: 15.55 cents a litre).

• The national average diesel petrol price rose by 1.3 cents to 134.1 cents a litre over the past week. The metropolitan price lifted 1.0 cent to 133.2 cents a litre and the regional price was up 1.5 cents to 134.8 cents a litre.

• Last week, the national average unleaded Terminal Gate Price (TGP) was up 3.1 cents to 126.4 cents a litre. And the terminal gate diesel price rose by 1.8 cents to 123.1 cents litre.

• Today, the average unleaded TGP stands at a 13-month high of 127.2 cents a litre, up by 2.4 cents over the week. The terminal gate diesel price eased from 12-month highs of 123.3 cents a litre to 123.0 cents a litre, but was still up 0.7 cents a litre over the week from 122.3 cents a litre.

• MotorMouth records the following average retail prices for unleaded fuel in capital cities today: Sydney 137.6c/l; Melbourne 136.1c/l; Brisbane 134.6c/l; Adelaide 139.0c/l; Perth 128.0c/l; Hobart 141.5c/l; Darwin 135.2c/l; and Canberra 139.8c/l.

• Last week the key Singapore gasoline price fell by US$5.56 – the most in 12 months – or 7.2 per cent to US$71.35 a barrel. And in Australian dollar terms, the Singapore gasoline price fell by $6.76 or 6.9 per cent to $92.03 a barrel or 57.88 cents a litre. It was the biggest fall in dollar terms since the week ending June 28, 2020.

Weekly used vehicle market

• Datium Insights have reported the following results for the week to March 22:

“Prices fell last week (-1.9 per cent) with ex-leases (-3.6 per cent) leading decreases

The market looks headed for its yearly dip over the Easter long weekend – a trend which was missed last year due to COVID

Supply also fell (-4 per cent) as stock continues to tighten in the market

Clearance rates were flat once again (+0.3 per cent)

Prices for the top 15 traded vehicles were mostly negative with the Holden Colorado seeing the greatest decrease (-5 per cent)

Stock still remains considerably low.”

What is the importance of the economic data?

• Weekly petrol prices data 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 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.

• Data analytics firm, Datium Insights, provides a weekly report on the used vehicle market. Datium Insights and Moody’s Analytics also issue a monthly reading on used vehicle prices. The data assists in gauging the strength of a key component of consumer spending and provides insights on the Autos and components sector of the sharemarket.

What are the implications for investors?

• Aussie petrol prices are broadly back at pre-pandemic levels with demand lifting as mobility increases due to the successful suppression of Covid-19. But the virus situation has deteriorated in Europe with fears of another wave of virus cases causing France to re-impose lockdowns. The slowing of Covid-19 vaccine rollouts due to distribution fears and concerns over side effects also dampened hopes that fuel demand would recover quickly.

• Last week, Brent crude fell by 6.8 per cent – the biggest weekly drop since October 2020 – to US$64.53 a barrel. And the US Nymex price lost 6.4 per cent to US$61.42 a barrel. Brent crude futures in London have dropped over 1 per cent so far in trading today, suggesting that oil traders are unwinding their long positions in the commodity and booking profits with prices up over 25 per cent so far this year. The moves saw the Singapore gasoline price plunge by the most in 12 months last week, potentially providing some relief for importers of refined petroleum product. But the average Aussie wholesale unleaded terminal gate price (TGP) hit 13-month highs of 127.2 cents a litre today, tempering hopes for a near-term reduction in local pump prices.

Published by Ryan Felsman, Senior Economist, CommSec

Extracted in full from: https://thebull.com.au/brisbane-petrol-prices-hit-1-70-a-litre/