Rising Aussie hoses down oil but petrol sting in pipeline
PETROL pump prices are expected to rise about six cents a litre in the next couple of weeks as the price of oil in the US hovers at record highs.
The good news is that it could have been much worse, if not for the Australian dollar, which is also near record highs and offsetting the oil price rise as the currency pushes towards parity with the greenback.
“Two big saviours for Australian motorists have been the (Australian Competition and Consumer Commission) price inquiry announced in June that is keeping a lid on petrol prices, and the rising dollar, which is providing an offset,” said AMP Capital’s chief economist Shane Oliver.
Oil lit up commodity markets for the second day running on Friday as US crude prices flared to record highs above $US92 a barrel on fresh tension along the Turkish-Iraqi border, US sanctions against Iran and low oil stocks in the US.
Dr Oliver said oil could reach $US100 a barrel. “With such a strong run-up over the last few days, it could be sooner rather than later,” he said.
Any rise is expected to put pressure on the Singapore petrol price. Australia uses that price as a benchmark.
“The good news is we won’t religiously follow the oil price higher because our main focus is on Singapore,” said CommSec’s Craig James. He said the petrol price rise would be short-lived.
