Petrol prices ease below $2 a litre, OPEC+ meets

Weekly oil market update

• Last week, the benchmark Singapore gasoline price fell by US$2.92 or 1.9 per cent US$154.28 a barrel, down from a record high of US$157.20 a barrel. In Aussie dollar (AUD) terms, the Singapore gasoline price fell by $7.04 or 3.2 per cent to $216.26 a barrel or 136.01 cents a litre, down from a record high of $223.30 a barrel.
• According to the Australian Institute of Petroleum (AIP), the national average wholesale price or Terminal Gate Price (TGP) of unleaded petrol sits at 188.1c/l today, down 1.4 cents in the past week. The wholesale price has increased by 35.4 cents since the recent low of April 14, 2022. The AIP will publish last week’s pump prices tomorrow due to the public holiday in Canberra.
• MotorMouth records the following average retail prices for unleaded fuel today: Sydney 203.1c/l; Melbourne 193.7c/l; Brisbane 201.7c/l; Adelaide 186.6c/l; Perth 188.8c/l; Hobart 201.9c/l; Darwin 199.7c/l and Canberra 200.2c/l. The daily CommSec estimated national petrol price today stands at 197.2 cents a litre, down 8.2 cents over the past week.

What does it all mean?

• Petrol prices have eased below $2 a litre. The daily CommSec estimated national unleaded petrol price today stands at 197.2 cents a litre (c/l), down 8.2 cents over the past week.
• The Australian Institute of Petroleum (AIP) will release their figures tomorrow due to the ACT public holiday. But in a sign that unleaded pump prices will continue to ease this week, the AIP’s measure of the national average wholesale price or Terminal Gate Price (TGP) of unleaded petrol sits at 188.1c/l today, down 1.4 cents in the past week.
• The retail unleaded petrol price discounting cycle has commenced on Australia’s East Coast, with prices down between 4 and 8 cents a litre in Brisbane, Sydney and Melbourne over the past week. While prices are still hovering around $2 a litre, they are decreasing and likely to fall further.
• Motorists should delay buying petrol until later, and should ‘top up’ rather than ‘fill up’ this week after shopping around for the best deals at servos. By comparing fuel prices on real-time apps from the RACV, RACQ, NRMA and MotorMouth, drivers can save themselves some coin.
• Cost of living pressures remain acute for Aussie households. In fact, CommSec estimates that it is costing the average family $276.11 a month to fill up the car with petrol, an extra $54 a month compared with the start of the year.
• International crude and refined petroleum prices are the biggest influence on Aussie domestic petrol prices. Imported gasoline prices fell last week from record highs as the Aussie dollar (AUD) strengthened against the greenback. In AUD terms, the Singapore gasoline price fell by $7.04 or 3.2 per cent to $216.26 a barrel or 136.01 cents a litre, down from a record high of $223.30 a barrel.
• But the respite for Aussie motorists could be short-lived. The global benchmark Brent crude oil price closed last week at two-month highs of US$119.43 a barrel. And Brent is on course for sixth consecutive monthly gain in May – the longest run of gains in more than a decade. A combination of supply restraint by OPEC, Russian crude sanctions and increased demand ahead of the US summer driving season have combined to pushed up crude oil prices. US gasoline inventories hit 8-year lows last week in a sign of tight global crude supplies.
• In the coming week, crude oil traders will continue to monitor developments in China with manufacturers poised to resume operations in Shanghai after renewed Covid-19 government lockdowns. And Bloomberg is reporting today that Chinese officials have brought Beijing’s virus outbreak under control.
• Elsewhere, the European Union (EU) continues to discuss a revised package of sanctions, including a possible ban on Russian crude, despite resistance from Hungary.
• But the key focus for investors this week will be on the OPEC+ producer group monthly meeting on Thursday. According to Bloomberg, Saudi Arabia and its allies have so far pushed-back on US pleas for a quickening of OPEC production as Russian exports fall due to Western sanctions. But with US retail gasoline prices hitting all-time highs, pressure is building on US President Joe Biden to repair diplomatic ties with Riyadh.

What do you need to know?

Weekly oil market update

• Last week, the Brent crude oil price rose by US$6.88 or 6.1 per cent to US$119.43 a barrel, the highest closing price in two months. And the US Nymex crude price added US$1.84 or 1.6 per cent to US$115.07 a barrel.
• In the past week, the benchmark Singapore gasoline price fell by US$2.92 or 1.9 per cent US$154.28 a barrel, down from a record high of US$157.20 a barrel.
• In Aussie dollar (AUD) terms, the Singapore gasoline price fell by $7.04 or 3.2 per cent to $216.26 a barrel or 136.01 cents a litre, down from a record high of $223.30 a barrel.
•  According to the Australian Institute of Petroleum (AIP), the national average wholesale price or Terminal Gate Price (TGP) of unleaded petrol sits at 188.1c/l today, down 1.4 cents in the past week. The wholesale price has lifted 35.4 cents since the recent low of April 14, 2022.
• The AIP will publish last week’s pump prices tomorrow due to the public holiday in Canberra.
• MotorMouth records the following average retail prices for unleaded fuel today: Sydney 203.1c/l; Melbourne 193.7c/l; Brisbane 201.7c/l; Adelaide 186.6c/l; Perth 188.8c/l; Hobart 201.9c/l; Darwin 199.7c/l and Canberra 200.2c/l.
• CommSec estimates that it is costing the average family $276.11 a month to fill up the car with petrol, an extra $54 a month compared with the start of the year.