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Aussie motorists keenly await OPEC meetingPetrol prices
Petrol: According to the Australian Institute of Petroleum, the national average Australian price of unleaded petrol fell by 2.4 cents last week to 146.4 cents per litre. Petrol prices fell in four of the capital cities. But petrol discounting cycles have ended, or are coming to an end, in major capital cities.
Inflation implications: So far in the June quarter the petrol price has increased around 6.5 per cent, potentially adding almost 0.2 percentage points to the quarterly change in the Consumer Price Index. 
What does it all mean?
The petrol price discounting cycle ended in Adelaide late last week and is now ending in Sydney. Petrol discounting cycles are likely to be drawing to a close in Melbourne and Brisbane, having run for around 26 days. So across the nation, petrol prices are likely to be trading near $1.55-1.60 a litre in the coming week.
But with the wholesale price near $1.33 a litre, and assuming gross retail margins of 12-13 cents a litre, the national average pump price should return to average near $1.45 a litre over the next few weeks.
The hope for motorists is that key OPEC and non-OPEC oil producers agree on Friday to put more crude on global markets. Oil prices closer to US$65 a barrel would better serve the interests of consumers and producers. If oil prices are too high, there is a risk that consumers and business broadly trim spending, therefore reducing the growth rate of global economic activity.
Petrol is the single biggest weekly purchase for most Australian families so any easing of pump prices would be positive for retailers of discretionary or non-essential goods.
What do the figures show?Petrol prices
According to the Australian Institute of Petroleum, the national average Australian price of unleaded petrol fell by 2.4 cents to 146.4 cents a litre in the past week.
The metropolitan petrol price fell by 2.8 cents to 144.0 cents per litre and the regional price fell by 1.5 cents to 151.4 cents per litre. The gross retail margin was stable at 12.38 cents.
Average unleaded petrol prices across states and territories over the past week were: Sydney (down by 0.7 cents to 142.7 c/l), Melbourne (down by 5.2 cents to 141.3 c/l), Brisbane (down by 6.4 cents to 153.6 c/l), Adelaide (up by 3.3 cents to 143.8 c/l), Perth (down by 1.6 cents to 148.5 c/l), Darwin (up by 0.4 cents to 155.5 c/l), Canberra (up by 0.1 cents at 155.1c/l) and Hobart (up by 0.1 cents to 157.9c/l).
Today, the national average wholesale (terminal gate) unleaded petrol price stands at a 133.3 cents a litre, down by 1.4 cents over the week. The terminal gate diesel price stands at 136.4 cents a litre, down by 0.6 cents over the past week.
The national average diesel petrol price fell by 0.2 cents to 154.4 cents a litre over the week. The metropolitan price fell by 0.1 cents to 155.0 cents a litre with the regional price down 0.3 cents to 153.9 cents a litre.
Last week the key Singapore gasoline price fell by US80 cents or 0.9 per cent to US$85.05 a barrel. But due to a lower Aussie dollar, in Australian dollar terms the Singapore gasoline price rose by $1.10 or 1.0 per cent last week to $113.93 a barrel or 71.66 cents a litre.
MotorMouth records the following average retail prices for capital cities today: Sydney 154.5c; Melbourne 141.9c; Brisbane 140.7c; Adelaide 158.4c; Perth 138.1c; Canberra 155.0c; Darwin 155.8c; Hobart 157.7c.
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?
Higher oil prices have driven by gasoline/petrol prices and have contributed to rising inflationary expectations globally. Petrol and gasoline prices have been near 4-year highs. But the price of Brent crude recently lifted to more than US$80 a barrel, prompting OPEC members to loosen the production restraint agreement.
Over the June quarter so far, Australian petrol prices have lifted 6.5 per cent, potentially adding almost 0.2 percentage points to the quarterly change in the Consumer Price Index. If the CPI lifts 0.6 per cent in the June quarter it would raise the annual growth rate from 1.9 per cent to a near 4-year high of 2.3 per cent.
CommSec expects official interest rates to be stable until early 2019. But inflation and wage data will be closely assessed in coming months.
Published by Craig James, Chief Economist, CommSec