Regional Aussie petrol prices hit record high   

Weekly oil market update

• According to the Australian Institute of Petroleum, the national average unleaded petrol price rose by 6.4 cents to 211.9 cents a litre (c/l) last week, the second highest level on record (data since 2004). Average weekly pump prices hit record highs in Brisbane (219.3c/l), Canberra (220.1c/l) and Sydney (216.4c/l). And the regional average unleaded petrol price rose by 10.4c/l to an all-time high of 211.3c/l last week.
• But daily average retail unleaded pump prices have eased from record highs in Adelaide, Brisbane and Sydney in the past week, according to MotorMouth. Prices are falling due to the commencement of the retail petrol price discounting cycle. Motorists should top up rather than fill up their tanks with prices expected to fall further.
• According to the Australian Institute of Petroleum (AIP), the national average wholesale price or Terminal Gate Price (TGP) of unleaded petrol eased from a record high 201.0c/l on June 23, 2022 to 200.3c/l today.
• OPEC and Russia (OPEC+) meet on Thursday (June 30, 2022) to determine their crude oil production targets for July and August. And Group of Seven (G7) leaders are considering a crude oil price cap on Russian crude oil.

What does it all mean?

• Last week, the Australian Institute of Petroleum (AIP) reported that the national average unleaded petrol price rose by 6.4 cents to 211.9 cents a litre (c/l) last week, the second highest level on record (data since 2004). Average weekly pump prices hit record highs in Brisbane (219.3c/l), Canberra (220.1c/l) and Sydney (216.4c/l).
• And the regional average unleaded petrol price rose by 10.4c/l to a record high 211.3c/l last week – not ideal for Aussie farmers and agribusiness owners contending with soaring cost of living pressures and elevated agricultural costs of production.
• CommSec estimates that it is costing the average family $296.66 a month to fill up the car with petrol – just below the recent record high of $297.50 a month. It now costs an extra $74.48 a month to fill up the car compared with the start of the year – just six months ago.
• But motorists heading to the ski fields for the school holidays may have noticed that daily retail unleaded petrol prices have begun to ease from record highs. In fact, figures from real-time fuel app MotorMouth today show that prices are down by as much as 6 cents a litre (c/l) in Brisbane and Sydney in the past week as the retail petrol price discounting cycle gets underway.
• That said, retail pump prices in Sydney are still as high as 224.9c/l today in harbourside and beachside suburbs. But prices have been cut to lows of 195.7c/l in Sydney’s south-west. With prices likely to decrease further, motorists should delay filling up their tanks until later. Average daily retail Sydney pump prices had hit an all-time high of 218.7c/l on June 20, 2022.
• Similarly, Brisbane retail unleaded pump prices are as high as 224.9c/l today in inner city suburbs. But prices have been cut to lows of 199.9c/l in Brisbane’s south. Motorists should top up rather than fill up their tanks with prices expected to fall further. Average daily retail Brisbane pump prices had hit a record high of 223.3c/l on June 20, 2022.
• Melbourne daily retail unleaded petrol prices are hovering around 205c/l today, continuing to grind lower from the most recent peak of 217.1c/l on June 13, 2022. Prices are also expected to fall further, before a potential price hike next week, with the current discounting cycle now 14 days old in length. The typical discounting cycle lasts around three weeks.
• And in Adelaide, daily retail unleaded petrol prices have dropped by 26c/l after hitting record highs of 226.7c/l on June 20, 2022. With pump prices dipping, motorists should delay buying petrol until a little later.
• The fall in retail unleaded petrol prices coincides with an easing in international crude oil prices and domestic wholesale pump prices. According to the AIP, the national average wholesale price or Terminal Gate Price (TGP) of unleaded petrol eased from a record high 201.0c/l on June 23, 2022 to 200.3c/l today. But the wholesale price has risen by 47.6 cents a litre since the recent low of April 14, 2022.
• International crude and refined petroleum prices are the biggest influence on Aussie domestic petrol prices. And in a positive development for beleaguered Aussie motorists, imported gasoline prices continued to ease from the record high of US$160.80 a barrel on June 12, 2022. In fact, the benchmark Singapore gasoline price fell by US$5.61 or 3.6 per cent – the biggest decline in 12 weeks – to US$152.45 a barrel in the past week. In Aussie dollar terms, the Singapore gasoline price fell by $4.73 or 2.1 per cent to $220.69 a barrel or 138.80 cents a litre.
• Last week, the US Nymex or West Texas Intermediate (WTI) crude price dipped by US$1.94 or 1.8 per cent to US$107.62 a barrel, its first back-to-back weekly loss since April. Oil prices fell on investor worries that aggressive central bank interest rate hikes to counter inflation will cause a global economic slowdown, weighing on fuel demand. Crude oil prices have eased, despite persistent tightness in oil markets as supply risks persist.
• Despite near record high gasoline prices, Google Mobility data shows that US traffic numbers remain elevated during the summer ‘driving season.’ And with Covid-19 lockdowns easing in Shanghai and Beijing, the average traffic congestion in 15 Chinese cities has been above January 2021 levels for more than a month, according to Bloomberg.
• Leaders from the world’s seven largest economies – the Group of Seven or G7 – met on Sunday in the Bavarian Alps. G7 officials are discussing a potential cap on the price of Russian oil by imposing restrictions on insurance and transportation. That said, Bloomberg has reported that an agreement is yet to be reached.
• Also headlining the oil markets agenda this week is the monthly meeting of OPEC and its alliance partner Russia. With several producers running out of spare capacity, the OPEC+ alliance is expected to stick to a plan to boost production by 648,000 barrels per day (bpd) in July and by the same amount in August, up from the initial plan to add 432,000 bpd a month over the three months until September. But producers have struggled to hit the monthly increase targets due to under-investment in oilfields by some OPEC members and, more recently, losses in Russian output.

What do you need to know?

Weekly oil market update

• Last week, the Brent crude price was unchanged at US$113.12 a barrel. And the US Nymex crude price fell by US$1.94 or 1.8 per cent to US$107.62 a barrel, its first back-to-back weekly loss since early April.
• In the past week, the benchmark Singapore gasoline price fell by US$5.61 or 3.6 per cent – the biggest decline in 12 weeks – to US$152.45. In Aussie dollar terms, the Singapore gasoline price fell by $4.73 or 2.1 per cent to $220.69 a barrel or 138.80 cents a litre.
• According to the Australian Institute of Petroleum (AIP), the national average unleaded petrol price rose by 6.4 cents to 211.9 cents a litre (c/l) last week, the second highest level on record (data since 2004). Average weekly pump prices hit record highs in Brisbane (219.3c/l), Canberra (220.1c/l) and Sydney (216.4c/l) in the past week.
• Metropolitan pump prices rose by 4.3 cents to 212.1c/l and regional prices rose by 10.4 cents to a record high 211.3c/l in the past week.
• The national average wholesale price or Terminal Gate Price (TGP) of unleaded petrol eased from a record high 201.0c/l on June 23, 2022 to 200.3c/l today. But the wholesale price has risen by 47.6 cents a litre since the recent low of April 14, 2022.
• The smoothed (2-month average) gross retail margin fell last week from 10.59 cents a litre to a fresh 3-year low of 10.11 cents a litre (12-month average: 13.77 cents per litre).
• MotorMouth records the following average retail prices for unleaded fuel today: Sydney 213.8c/l; Melbourne 205.1c/l; Brisbane 215.9c/l; Adelaide 200.8c/l; Perth 198.5c/l; Hobart 216.7c/l; Darwin 209.6c/l and Canberra 221.9c/l.
• CommSec estimates that it is costing the average family $296.66 a month to fill up the car with petrol – just below the recent record high of $297.50 a month. It now costs an extra $74.48 a month to fill up the car compared with the start of the year – just six months ago.