Petrol prices on the rise again

Energy Matters0

Commonwealth Securities economist Savanth Sebastian said the time of petrol prices hovering around $1 was over and he expected average prices to climb 10 cents in the next two weeks.

“There is no chance of seeing petrol under $1 a litre,” Mr Sebastian said.

“We enjoyed that while we could late last year, but it is well and truly on its way out.”

Mr Sebastian said petrol prices are rising across Asia.

Increasing demand for oil by China late last year, coupled with the introduction of an oil consumption tax, has caused pricing uncertainty in the region, he said.

OPEC production cuts are also having a more pronounced impact in the region, Mr Sebastian said.

“The global oil price continues to fall, or remain quite depressed, but in the Asian region we have seen the unleaded prices continue to skyrocket,” he said.

The benchmark Singapore unleaded petrol price has risen for four consecutive weeks to $92 a barrel — almost by 66 per cent in Australian dollar terms.

“If you go back to early November when we had (Singapore) unleaded prices at that level, we had (local) prices close to $1.30 to $1.40 a litre,” he said. “If nothing changes and if things hold steady in terms of the (Singapore) unleaded price holding at around $90 a barrel then you are going to get petrol prices going back to $1.40 a litre.”

As the world crude price hovered around $US46.50 a barrel yesterday, the price of unleaded petrol across Melbourne crept up to a high of 117.9 cents a litre, according to motoring group RACV.

The average unleaded petrol price in Melbourne yesterday was 111.1 cents a litre and the lowest price was 104.3 cents at Hallam.

The RACV has called for Australia’s import parity policy to be reviewed, arguing that the pricing system, which uses Singapore as the price benchmark for most fuel, is obsolete and has a lag of up to two weeks between changes there and here.

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