The days of cheap petrol may soon be a thing of the past, as wholesale fuel prices continue to rise. According to commodities expert David Scutt, wholesale petrol prices in Singapore, where Australia sources most of its refined fuels, have increased by over 30% in Australian Dollar terms since July 2023.
While retail pump prices have also seen a significant increase in recent months, it appears that there is no relief in sight for motorists. Scutt predicts that the bottom of the fuel price cycle will be around $2 per litre for 91 octane, given the rising wholesale costs.
This increase in fuel prices is having a substantial impact on households’ transport costs. According to the Australian Automotive Association, the average household is spending nearly $415 per week on transportation expenses. This amounts to approximately 16% of household income, which is allocated towards fuel, car loan repayments, tolls, public transport, insurance, servicing, tyres, registration and licensing, and roadside assistance.
Sydney residents are hit the hardest, spending over $510 per week on transport costs. Meanwhile, those in Melbourne and Brisbane are forking out over $500. These figures highlight the financial burden that rising fuel prices are placing on households across the country.
As wholesale fuel prices continue to climb, it may be time for motorists to reevaluate their expectations of cheap petrol. The days of paying less than $2 per litre for unleaded could soon become a luxury of the past.
– David Scutt
– Australian Automotive Association