While Australian wage growth is running at the lowest level seen in decades, with average weekly earnings going backwards in real terms, Australian households can take some comfort that one of their largest weekly expenses is falling at an even faster pace: petrol prices.
According to Commsec, citing data from the Australian Institute of Petroleum, the national average price for unleaded petrol slid to 106.5 cents per litre last week, leaving it at the lowest level seen in seven years.
The average metropolitan price fell by 3.4 cents to 103.7 cents per litre, outpacing a 1.7 cents drop in regional areas to 112.0 cents per litre.
The chart below, supplied by Commsec, reveals the steep decline in the national average price since the start of 2014.
However, with global crude prices up over 30% from late January, Commsec economist Savanth Sebastian believes that low for petrol prices, at least in the near-term, may be in.
“The lift in global crude oil prices in the past week may mean that the low point for petrol has been reached for the time being,” say Sebastian. “However given the volatility and ongoing concerns about excess oil supply, there is still the potential for further downward pressure over the medium term.”
Sebastian notes that as of today, the national average wholesale unleaded petrol price stands at 96.7 cents per litre, up 0.2 cents on a week ago.