- Average petrol prices in Sydney, Melbourne and Brisbane continued to ease last week, largely reflecting discounting from retailers.
- When the price discounting cycle came to an end in Adelaide last week, “prices lifted 25 cents a litre from the lows”, CommSec reports.
- Both crude oil and Singapore gasoline prices fell by the most in six months last week. CommSec doesn’t expect there’ll be much downside to come from current levels in the near-term.
After ratcheting higher since the beginning of the year, reflecting a weaker Australian dollar and soaring crude oil prices, petrol prices on Australia’s east coast are finally moving lower.
According to CommSec, citing data from MotorMouth, average unleaded petrol prices fell by between eight and 11 cents a litre in Melbourne, Sydney and Brisbane last week, pulling back from the year-to-date highs stuck earlier in the month.
The decline in retail petrol prices in Australia’s largest cities came despite the average national wholesale unleaded petrol price increasing 2.5 cents to 136.2 cents a litre over the same period.
In good news for motorists, CommSec reports that Singapore gasoline prices — where the vast bulk of Australia’s petrol is sourced from — tumbled by 5.8% to $US108.45 a barrel last week, the largest weekly fall in percentage terms in almost six months.
This followed similar declines in crude oil prices last week.
“The Brent crude price fell by 4.9% to $USD68.69 a barrel and the US Nymex price fell by 6.6% to $US56.07 a barrel,” said Ryan Felsman, senior economist at CommSec in a note released on Monday.
While that should help to place downward pressure on wholesale petrol prices in the weeks ahead, as seen in the chart below, average pump prices in Sydney, Melbourne and Brisbane have already been falling over the past couple of weeks, reflecting discounting from petrol retailers.
However, when the price discounting cycle comes to an end in those cities, Felsman says it could deliver an ugly surprise for motorists given what was seen in Adelaide last week.
“The discounting cycle ended in Adelaide on Wednesday and prices lifted 25 cents a litre from the lows,” he said.
So it may pay to top up the tank if you’re in the eastern capitals in the not-too-distant future, especially as CommSec expects Brent crude prices — the global benchmark — “to remain around $US70 a barrel in the near-term”.
Business Insider Emails & Alerts
Site highlights each day to your inbox.