East Coast petrol prices peak
Darwin petrol prices hit 11-month low
Weekly Petrol Prices
Petrol prices: According to the Australian Institute of Petroleum, the national average price of unleaded petrol rose by 8.6 cents – the most in 9 weeks – to 148.3 cents a litre last week.
East Coast petrol prices lift: According to data from MotorMouth, average daily unleaded retail petrol prices have risen by 28-33 cents a litre in Brisbane, Sydney and Melbourne from recent lows on February 2-4. But prices peaked on the weekend at $1.59-$1.66 a litre and will gradually decline as the discounting cycle resumes.
Capital city petrol prices fall: Today, average daily unleaded retail petrol prices have hit 11-month lows in Darwin (136.8 c/l); 7-month lows in Adelaide (123.5 c/l) and Perth (126.9 c/l); and 4-month lows in Canberra (145.2 c/l) and Hobart (154.6 c/l). The petrol price data have implications for retailers, especially petrol marketing groups.
What does it all mean?
The outlook for global crude oil demand remains gloomy. The economic cost of the novel coronavirus (COVID-19) on oil markets was brought into sharp focus last week when the International Energy Agency (IEA) and OPEC both downgraded their 2020 demand forecasts. In fact, the IEA expects world crude oil consumption to contract by 435,000 barrels per day during the March quarter of 2020 – the first quarterly contraction in a decade.
OPEC also said, “the impact of the coronavirus outbreak on China’s economy has added to uncertainties surrounding global economic growth in 2020, and by extension global oil demand growth in 2020.” OPEC producers lowered their Chinese oil demand forecast by 200,000 barrels a day from the previous month.
While investor sentiment towards oil remains cautious, last week the US Nymex oil price lifted by 3.4 per cent to US$52.05 a barrel and the Brent crude oil price rose by 5.2 per cent to US$57.32 a barrel – the first gains in six weeks. Why? China, Hong Kong and Singaporean governments have pledged extra fiscal stimulus – such as tax cuts – in an attempt to boost domestic demand as COVID-19 hits supply chains and production.
Declining global crude oil prices (the US Nymex price is down almost 18 per cent since January 6) have benefited Aussie motorists. During this period, the key Singapore gasoline price – used as a benchmark price for Australia’s imported refined petroleum product – has declined by 13.4 per cent or US10.20 cents a litre to US$66.00 a barrel. And the wholesale (Terminal Gate Price) now stands at 126.1 cents a litre.
In this environment it is no surprise to see East Coast unleaded pump prices hitting lower peaks in the retail cycle. In Brisbane, Sydney and Melbourne, average daily retail unleaded petrol prices averaged 159.70 – 165.90 cents a litre last week. Whereas prices Averaged 164.40 – 171.70 cents a litre at the previous cycle peak in mid-January.
And the lower prices at the bowser are broadening to the smaller and less competitive fuel markets of Darwin, Hobart and Canberra with unleaded pump prices currently between 4-11 month lows.
What do the figures show?
According to the Australian Institute of Petroleum, the national average price of unleaded petrol rose by 8.6 cents – the most in 9 weeks – to 148.3 cents a litre last week. The metropolitan price rose by 13.3 cents to 150.7 cents a litre, but the regional price fell by 0.8 cents to 143.5 cents a litre.
Average unleaded petrol prices across states and territories over the past week were: Sydney (up 17.4 cents to 151.7 c/l), Melbourne (up by 24.3 cents to 157.7 c/l), Brisbane (up by 21.9 cents to 159.2 c/l), Adelaide (down by 22.0 cents to 130.9 c/l), Perth (down by 2.1 cents to 135.6 c/l), Darwin (down by 0.9 cents to 137.0 c/l), Canberra (down by 0.8 cents to 145.5 c/l) and Hobart (down by 0.3 cents to 154.8 c/l).
The smoothed gross retail margin (2-month rolling average) for unleaded petrol rose from 14.41 cents a litre to 14.79 cents (24-month average: 13.2 cents a litre).
The national average diesel petrol price fell by 0.7 cents to 148.5 cents a litre over the past week. The metropolitan price fell by 0.5 cents to 147.3 cents a litre and the regional price was down by 0.8 cents to 149.5 cents a litre.
Today, the national average wholesale (terminal gate) unleaded petrol price stands at 126.1 cents a litre, up 0.5 cents over the week. The terminal gate diesel price stands at 127.7 cents a litre, down by 0.6 cents over the past week.
MotorMouth records the following average retail prices for unleaded fuel in capital cities today: Sydney 158.5c; Melbourne 159.5c; Brisbane 163.8c; Adelaide 123.5c; Perth 126.9c; Canberra 145.2c; Darwin 136.8c; Hobart 154.6c.
The key Singapore gasoline price rose by US90 cents or 1.4 per cent last week to US$66.00 a barrel. In Australian dollar terms, the Singapore gasoline price rose by $1.33 or 1.4 per cent to $98.23 a barrel or 61.78 cents a litre.
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 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 East Coast retail discounting cycle has commenced. But drivers should ‘top up’ this week and ‘fill up’ next week as unleaded petrol prices gradually decline over the next two weeks.
Published by Ryan Felsman, Senior Economist, CommSec