Further signs that petrol has bottomed

Weekly petrol prices

• Petrol prices ease: According to the Australian Institute of Petroleum, the national average Australian price of petrol fell by 2.4 cents per litre last week to 108.6 cents a litre – the lowest price in six years (since January 19 2009). Prices have fallen for 10 straight weeks, down 34.2 cents.
• Signs that prices have bottomed: The terminal gate (wholesale) price rose by 2.3 cents a litre over the past week. The Singapore gasoline price has lifted 4.2c a litre over the past fortnight in local terms.

What does it all mean?

• While there are signs that petrol prices are bottoming, they are just signs, not concrete proof that bowser prices are set to rise. Still, petrol prices are at or near the lowest levels in around six years. And motorists are still well in front on filling up the car with petrol compared with a year ago.
• The average household is spending $130 a month on petrol, down $55.50 a month on a year ago and equivalent to a 0.25 per cent rate cut on a $350,000 mortgage.
• The lower cost of petrol has broader benefits for the community than an interest rate cut, affecting all motorists, as well as lowering costs for businesses.
• According to the Australian Institute of Petroleum, the national average Australian price of petrol fell by 2.4 cents per litre last week to 108.6 cents a litre. The metropolitan petrol price fell by 2.2 cents to 104.1 cents per litre and the regional price fell by 2.9 cents to 117.6 cents per litre.
• The national average Australian price of diesel petrol fell by 2.1 cents to 127.1 c/l in the week to February 1. Last week the metropolitan price fell by 2.1 cents to 126.1 c/l, while the regional average price fell by 2.2 cents to 127.9 c/l.
• Average unleaded petrol prices across states and territories over the past week were: Sydney (down by 1.4 cents to 101.7 c/l), Melbourne (down by 2.4 cents to 102.6 c/l), Brisbane (down by 3.8 cents to 103.1 c/l), Adelaide (down by 2.5 cents to 99.9 c/l), Perth (down by 0.9 cents to 110.2 c/l), Darwin (down by 1.2 cents to 129.1 c/l), Canberra (down by 2.9 c/l to 117.6 c/l) and Hobart (down by 1.4 c/l to 123.4 c/l).
• Today, the national average wholesale (terminal gate) unleaded petrol price stands at a 14-day high of 103.53 cents a litre, up 2.3 cents on the previous week and up 3.1 cents from 6-year lows.
• Last week the key Singapore gasoline price rose by US$1.65 or 2.9 per cent to US$58.70 a barrel – the second week of gains and up from the near 6-year low (lowest since March 2009) of US$52.20 set on January 13. And due to a weaker currency, in Australian dollar terms the Singapore gasoline price rose by $4.01 a barrel or 5.6 per cent last week to $75.44 a barrel or 47.45 cents a litre. Prices are up 4.2 cents a litre in the past fortnight.
• Figures from MotorMouth show that capital city petrol prices drifted sideways to slightly lower last week.
• 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.
• The fall in the petrol price waters down the need to cut interest rates again.
• There are few signs that petrol prices are set to rebound sharply, rather they are more likely to stay lows for a period of time. OPEC oil producers are determined to regain market share and squeeze out the higher cost producers.

What do the figures show?

• According to the Australian Institute of Petroleum, the national average Australian price of petrol fell by 2.4 cents per litre last week to 108.6 cents a litre. The metropolitan petrol price fell by 2.2 cents to 104.1 cents per litre and the regional price fell by 2.9 cents to 117.6 cents per litre.
• The national average Australian price of diesel petrol fell by 2.1 cents to 127.1 c/l in the week to February 1. Last week the metropolitan price fell by 2.1 cents to 126.1 c/l, while the regional average price fell by 2.2 cents to 127.9 c/l.
• Average unleaded petrol prices across states and territories over the past week were: Sydney (down by 1.4 cents to 101.7 c/l), Melbourne (down by 2.4 cents to 102.6 c/l), Brisbane (down by 3.8 cents to 103.1 c/l), Adelaide (down by 2.5 cents to 99.9 c/l), Perth (down by 0.9 cents to 110.2 c/l), Darwin (down by 1.2 cents to 129.1 c/l), Canberra (down by 2.9 c/l to 117.6 c/l) and Hobart (down by 1.4 c/l to 123.4 c/l).
• Yesterday, the national average wholesale (terminal gate) unleaded petrol price stood at a 14-day high of 103.53 cents a litre, up 2.3 cents on the previous week and up 3.1 cents from 6-year lows.
• Last week the key Singapore gasoline price rose by US$1.65 or 2.9 per cent to US$58.70 a barrel – the second week of gains and up from the near 6-year low (lowest since March 2009) of US$52.20 set on January 13. And due to a weaker currency, in Australian dollar terms the Singapore gasoline price rose by $4.01 a barrel or 5.6 per cent last week to $75.44 a barrel or 47.45 cents a litre. Prices are up 4.2 cents a litre in the past fortnight.

·         Figures from MotorMouth show that capital city petrol prices drifted sideways to slightly lower last week.

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 fall in the petrol price waters down the need to cut interest rates again.
• There are few signs that petrol prices are set to rebound sharply, rather they are more likely to stay lows for a period of time. OPEC oil producers are determined to regain market share and squeeze out the higher cost producers.