As a result of decreases in worldwide supply occurring at the same time that school vacations are taking place, the price of petrol in Brisbane has reached an all-time high, and residents of Sydney and Melbourne have been advised to expect price increases in the near future.
According to Ian Jeffreys, the lead economic and affordability specialist for the RACQ, the new peak price of $2.38 cents for a liter of standard fuel in Brisbane is the highest ever observed in the city. This price surpasses the existing high prices of $2.29 a liter in Sydney and Melbourne.
It was last Friday, he claimed, when two gas stations on the Bruce Highway in Burpengary – on the way to the Sunshine Coast – smashed the record before decreasing their prices later that day. He said this marked the beginning of the recent price increase.
“And then on Monday morning, enough of them decided, ‘we want to push the price up,’ and then the rest are starting to follow,” Jeffreys said. “And then on Tuesday morning, the rest of them decided, ‘we want to push the price up.'”
According to Chris Ford, who works for Compare the Market, the price difference between the most costly and the cheapest fuel in Brisbane on Wednesday was an extremely high 44 cents.
“If you were to fill up a tank that was 50 liters, you would save $20 by doing so at the location that was the least expensive as opposed to the location that was the most expensive,” he stated.
Although the citywide average price of in Brisbane was still $2.01, which was lower than Sydney’s $2.13 and Melbourne and Adelaide’s $2.21, Jeffreys predicted that this would not be the case for much longer.
“What we see is that the expensive sites tend to cluster,” he said. “This is what we see.”
Consequently, “one site will jump, and then the sites that are neighboring will jump,” and “then, over the course of those 10 days, those expensive clusters will grow, and the cheap clusters will shrink,” respectively.
On August 24th, the previous record price for Brisbane, which was $2.29, was set.
Jeffreys anticipates that Melbourne and Sydney will soon follow suit and see an increase in the average pricing with extended weekends in both cities. Jeffreys’ prediction is that this trend will continue.
According to the most recent data from the ABS, the cost of a gallon of gas has increased by 13.9% when compared with the price it was just one month ago (9.1%).
According to Brendan Rynne, chief economist at KPMG, international prices are higher as a result of a decision by the oil cartel Opec and a large supplier like Russia to restrict production. This decision has led to a decrease in overall supply.
According to him, another factor that is contributing to price increases right now is the relatively weak state of the Australian currency.
“We’re getting the double effect of increasing cost of gasoline in the open market, as well as having to pay for that at a lower exchange rate, which is therefore driving up gasoline prices,” he added. “We’re getting the double effect of increasing cost of gasoline in the open market.”
Ryne stated that there is some good news in the medium term: it is expected that gasoline prices will drop after this cycle, given northern Europe is heading into winter at this point.
“Part of that will be an expectation that oil demand around the world is probably going to soften over the coming six months,” because this is typically the case when the winter season arrives in the northern hemisphere.