Weekly petrol prices
Unleaded petrol: The Australian Institute of Petroleum will not release the weekly national average petrol price data until next Monday.
Wholesale petrol: Today the terminal gate (wholesale) price of unleaded petrol stands at a near 11-month low of 107.1 cents per litre (lowest since February 4).
Diesel: The terminal gate (wholesale) price of diesel fuel stands at 97.1 cents a litre, down 1.2 cents in the past week to fresh 11-year lows.
What does it all mean?
There are no signs of an end to low global oil prices. Saudi Arabia is determined to shore up its market share and force the higher-cost oil and – broader – energy producers out of the market. While low oil prices are taking their toll on budgets and foreign exchange reserves in the Middle East, the OPEC oil cartel is content with producing more oil than is required on the global market.
While the low global oil price is putting pressure on the profitability of producers, it is clearly good news for consumers. The issue for Australian motorists is getting some consistency on price. MotorMouth records a difference of around 25 cents a litre across Australian capital cities. Adelaide and Sydney motorists can fill up at near the cost price of the petrol marketing groups but gross retail pricing margins are higher and more diverse across other capital cities.
Low petrol prices will keep inflation low, and thus serve as a cap on interest rates. But retailers also benefit fromconsumers having extra spending power. Filling up the car with petrol is the single biggest weekly purchase for most families.
What do the figures show?
Today the national average wholesale (terminal gate) unleaded petrol price stands at 107.1 cents per litre, down 1.1 cents per litre on a week ago. The terminal gate diesel price stands at 97.1 cents a litre, down 1.2 cents over the week.
Last week the key Singapore gasoline price fell by US90c or 1.6 per cent to US$55.50 a barrel. In Australian dollar terms the Singapore gasoline price fell by $2.56 a barrel or 3.2 per cent to $76.50 a barrel or 48.11 cents a litre. On Monday Singapore gasoline fell further to US$54.80 or A$75.53 a barrel.
In Australian dollar terms, Singapore gasoline is trading at the lowest price since January 30.
MotorMouth records the following retail prices for capital cities today: Sydney 109.1c; Melbourne 125.7c; Brisbane 118.6c; Adelaide 107.2c; Perth 130.3c; Canberra 128.4c; Darwin 125.8c; Hobart 132.5c
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?
The implications stated below haven’t changed from the report issued last week.
Lower global oil prices have potential to boost economic activity provided that businesses and consumers spend the extra savings reaped at the petrol pump.
Rising gross retail margins on fuel may be supporting revenues and profits for petrol marketing groups. The big unknown is whether the margins have lifted to cover higher costs in other parts of the business.
The lower cost of fuel is potentially good news for retailers – that is, providing that the savings are spent, not saved.
