The skyrocketing price of petrol

johnboy 15 March 2011 45

petrol prices

The Canberra Times notes that the price of middle eastern democracy movements is being felt at the petrol pumps with a swingeing $1.50 per litre out there and another 3 to four cents a litre predicted.

CommSec economist Savanth Sebastian said escalating tensions in the Middle East could drive this figure even higher to a national average of $1.45 a litre.

He expects service stations across Canberra to increase the cost of petrol by a further 3c to 4c during the next fortnight. ”Households are spending on average $30 more a month on petrol than they were six months ago.”

Without wanting to vent smug, my bicycle has cost me not a cent to run so far this year, and has some health benefits.

You can pick one up at the R-Shop in Mitchell for $20 and be on road for less than $50.


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45 Responses to The skyrocketing price of petrol
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Master_Bates Master_Bates 1:05 pm 05 Apr 11

Simple solution….. Get a newer job that pays a better wage!

allyroger allyroger 12:58 pm 05 Apr 11

Can someone tell me why the governement and the party who are really in charge, the Greens make absolutley zero effort in promoting the development and uptake of hydrogen powered cars. Would of thought that zero emmissions combined with the ability to tax the hell out of the fuel would be very persuasive yet all we hear is anti car bias. Face it, if you have children you are not going to get 2-4 buses to pick them up when they are sick from daycare. Canberra was built for the car, embrace it.

georgesgenitals georgesgenitals 11:55 am 05 Apr 11

zig said :

georgesgenitals said :

Trouble with a horse if you have to keep putting food in it even if you don’t ride it!

But how much is a horse to keep and feed a week? $100-150?

The government would find some way of taxing horses that are used for personal transport anyhow no doubt!

Guess you wouldn’t have to pay parking though, but where would you “park” your mount?

Horses can’t do burnouts, but you CAN light their farts.

zig zig 11:45 am 05 Apr 11

georgesgenitals said :

Trouble with a horse if you have to keep putting food in it even if you don’t ride it!

But how much is a horse to keep and feed a week? $100-150?

The government would find some way of taxing horses that are used for personal transport anyhow no doubt!

Guess you wouldn’t have to pay parking though, but where would you “park” your mount?

Mr Gillespie Mr Gillespie 8:52 am 05 Apr 11

zig said :

Time to sell the car, buy a horse and ride in the green cycle lanes leaving obstacles behind for the lycra brigade to negotiate.

The “green cycle lanes” are a dangerous joke, you don’t go riding in traffic within centimetres of cars whizzing past you at 80ks. Try the footpath or the cyclepath, it’s a lot safer there!

georgesgenitals georgesgenitals 8:21 am 05 Apr 11

zig said :

Time to sell the car, buy a horse and ride in the green cycle lanes leaving obstacles behind for the lycra brigade to negotiate.

Trouble with a horse if you have to keep putting food in it even if you don’t ride it!

zig zig 11:15 pm 04 Apr 11

Time to sell the car, buy a horse and ride in the green cycle lanes leaving obstacles behind for the lycra brigade to negotiate.

colourful sydney racing identity colourful sydney racing identity 4:20 pm 21 Mar 11

Captain RAAF said :

proof positive that the price of fuel is not an issue for people who love cars.

I think that should read ‘proof positive that the price of fuel is not an issue for people with no brains’

Rawhide Kid Part3 Rawhide Kid Part3 3:17 pm 21 Mar 11

shirty_bear said :

triffid said :

But, if you otherwise consider that you can use up to 50 per cent more gas per unit measure than ULP for a given journey (that is, if it takes you 10 L of ULP to do 100 km then you may find it takes you 15 L of gas to do the same 100km), and with excise about to be levied on LPG (and other alternative fuels) how do the sums stack up then?

Don’t know about excise … nothing would shock.
But stories of high LPG consumption aren’t borne out by my (nor some of my friends’) experience. I ran an LPG Falcom wagon for 2 years, and its consumption was directly comparable to petrol. As was performance. And it had large capacity (thx to being LPG-only, presumably), so its range was also large.

You’ll find that Duel fuels cars will burn LPG at a higher rate due to the comprise tuning of the engine to run on both fuels. Whereas if the engine is tuned to run only on LPG then the consumption would be leaner.

Captain RAAF Captain RAAF 2:38 pm 21 Mar 11

CoffinRX2 said :

Ahhh the joys of company cars!!

Still I run my turbo charged weekend cars on E85 which is significantly cheaper, cleaner, and gives more power!

Captain RAAF, I’ll be at COTM working all weekend. .. feel free to come say hi, … one of the major sponsors with a green tent 😉

Damo

Damo, sorry, I just saw this post so didn’t come visit you at the green tent. I did try and post a COTM topic but JB hates Chryslers (something about ‘bloody wog chariots’)

Quite a few cars from Canberra there (see JB, it should have been a topic of it’s own) and was overall a great event. Getting back on the subject, I managed to consume a small countries allocation of petrol, as did the record breaking 700+ cars at the event, proof positive that the price of fuel is not an issue for people who love cars, so any government that thinks raising the cost of petrol will force old car enthusiasts off the road had better think again.

shirty_bear shirty_bear 9:07 am 16 Mar 11

triffid said :

But, if you otherwise consider that you can use up to 50 per cent more gas per unit measure than ULP for a given journey (that is, if it takes you 10 L of ULP to do 100 km then you may find it takes you 15 L of gas to do the same 100km), and with excise about to be levied on LPG (and other alternative fuels) how do the sums stack up then?

Don’t know about excise … nothing would shock.
But stories of high LPG consumption aren’t borne out by my (nor some of my friends’) experience. I ran an LPG Falcom wagon for 2 years, and its consumption was directly comparable to petrol. As was performance. And it had large capacity (thx to being LPG-only, presumably), so its range was also large.

welkin31 welkin31 8:55 am 16 Mar 11

A few quick observations.
The AIP pages are putting the oil industry view – there may be useful data there – but lets have no doubt about who pays their bills.
The oil industry has a natural interest in higher pump margins – Govts come and go relatively frequently but Oil Co interests live on unchanged and they have been brilliantly successful over the decades at getting their view across and making excess margins.
It amazes me how commentators – even the ACCC – bow and scrape before the so called “weekly price cycles” – these cycles are entirely a creature of the Oil Cos and are simply a marketing ploy letting them frequently hike pump prices at their whim which gives them a greater chance to fog the whole pricing issue, keep winning excess margins and make it difficult for observers to see trends.
IMHO Australia badly needs a “National Fuels Corp” with the power to import tanker loads of ULP in the national interest – for supply to independent petrol retailers. The NFC might need powers to requisition tank farms. Only then would we see Australian motorists paying fair pump prices. The NFC should also publish free online and downloadable – updated all available price data.
I can hear the Oil Co screams of protest now.

I would take note of what FuelTrac says from time to time.
http://www.fueltrac.com.au/index.cfm
Anybody can download in xls files monthly average ulp pump price data for many Australian cities.
http://www.aaa.asn.au/issues/petrol.htm

BTW world oil price has turned down again and is under $100 now – lets see how soon this is reflected at the pump.

CoffinRX2 CoffinRX2 1:29 am 16 Mar 11

Ahhh the joys of company cars!!

Still I run my turbo charged weekend cars on E85 which is significantly cheaper, cleaner, and gives more power!

Captain RAAF, I’ll be at COTM working all weekend. .. feel free to come say hi, … one of the major sponsors with a green tent 😉

Damo

Ledanta Ledanta 9:44 pm 15 Mar 11

I wonder how many whingers of a couple of cents increase in fuel per litre go down the club and blow a couple of hundred in the pokies on their night out?

triffid triffid 9:16 pm 15 Mar 11

arescarti42 said :

triffid said :

Of course, if you’d rather believe what a journo has interpreted as gospel, then, by all means . . .

The author of that SMH article is Graeme Bethune, “CEO of EnergyQuest, an economic consultancy specialising in oil and gas”, so I suspect he knows a bit more than your typical SMH journalist.

triffid said :

while the AIP website states that;

Singapore prices are the key pricing benchmarks for Australia because Singapore represents the competitive alternative source of supply for Australia.

To meet Australian demand, around 25 per cent of fuel is imported, mostly from Singapore.
Singapore is the regional refining, distribution and trading centre and among the world’s largest petroleum markets.

It sure does say all of those things. The SMH article also says “Furthermore, Australian refineries only produce three-quarters of the petrol, diesel and other products we consume” which is the same as saying 25% of fuel is imported. I fail to see any discrepancy.

The key point here is that crude oil is not a “fuel”, it is a raw material you refine into fuel. The AIP page you link has nothing to say about what percentage of crude oil consumed in Australia comes from overseas.

You’ll also notice that the AIP page says 3 lines down from the top in bold writing that “Australian fuel prices are dependent on world market prices for crude and petroleum products.”

What that says to me is if problems in the middle east cause the world price of crude oil to increase, then there is every reason that the price of fuel in Australia should also increase.

Granted, sir, granted. But the ACCC Report of Inquiry into the Retail Price of Unleaded Fuel in Australia DID look at the import figures. It’s has been, though, a couple of years since I poured over its 390-odd pages, but it is in there somewhere. I lucidly recall it being as I have suggested.

My point remains, irrespective, that the ‘Middle East’ crude is unsuitable for fuel production, particularly in this country given the age (and, hence, technology employed in the construction) of our refining equipment. Trust me . . . bugger all of it comes here and is refined here.

My ‘irk’ (I am irked) is when the price of oranges (Middle East / heavy sour paraffinic crude) is curiously linked / compared / rationalised to be indifferent to the price of eggs (TAPIS sweet light napthanic crude) by refiners, futures traders — select whoever has some agenda of self interest — and then that is used as an excuse to bump terminal gate prices (that is, wholesale fuel prices) up. Particularly when — and this is especially galling — if, just if, that increase was actually truly really based on an oncost derived from ‘price increased due to political turmoil’ crude, we wouldn’t be seeing that manifested at the pumps for at least another month. Two – three weeks from wellhead to underground tank at your friendly local? Give me a break.

And, for the record, I’d much prefer to trust the people that actually work in this space (as I once did) who do know the technical difference between various crudes, base stocks, their origins, and the limitations of aging vacuum cracking plants rather than an economics consultancy firm who may, or may not, be a provider of services to importers / refiners and who may, or may not, have ever got their hands dirty with the stuff and who may, or may not, have just ever traded in theory and little more. Just saying.

bd84 bd84 9:05 pm 15 Mar 11

dtc said :

Ian said :

Strange though how all the external price drivers line up for a long weekend.

1.40 litre in Canberra on Friday; 1.50 litre in Bungendore passing through 30 minutes later.

Good things we (I) dont live in Bungendore

Johnboy – as a fellow rider I support you. But, then again, if you lived in (say) Gunghalin you may have saved $200k on buying a house and that buys an awful lot of petrol.

Interesting, I went past the Caltex/Woolies at Hume on Saturday which had an unleaded (discounted)price of $1.329/L, but the one at Majura Park was offering it for $1.299 (though it could have been the E10 as I didn’t pay too much attention). By Monday, the one at Tuggeranong was selling at $1.459.

I don’t see it being fully related to the long weekend, the cycle of cheap petrol has gone out the window here, I think the cheap day is currently Thursday (it was $1.279 last week). The cheap cycle is also totally different in Sydney, which from what I’ve heard cheap day is currently Saturday. They like to keep us guessing to make us pay more I guess.

farnarkler farnarkler 7:31 pm 15 Mar 11

arescarti42 said :

Individuals and governments really need to start thinking about what they’d be doing if petrol goes to $2-3+ a litre.

Recently there have been 2 things that have worked in Australia’s favor as far as petrol prices, the first is the strong Australian dollar caused by the commodities boom, and the second is the fact that the main consumers of oil, the USA, Europe, and to a lesser extend China and India, got smacked by the mother of all economic downturns.

If demand for oil picks up again (recovery in the USA/Europe, greater growth in the developing world) then there is no reason to think that a barrel of oil wont go back to $150+ like it was before the GFC.

Throw in the fact that the world supply/production of oil hasn’t really increased significantly since 2005, a bit of political unrest in the middle east, and a decline in the AUD and $1.5 a litre is going to look like a bargain.

From my perspective, it is another reason to be investing in public transport now.

Sell the car and buy one powered by LPG.

arescarti42 arescarti42 7:02 pm 15 Mar 11

triffid said :

Of course, if you’d rather believe what a journo has interpreted as gospel, then, by all means . . .

The author of that SMH article is Graeme Bethune, “CEO of EnergyQuest, an economic consultancy specialising in oil and gas”, so I suspect he knows a bit more than your typical SMH journalist.

triffid said :

while the AIP website states that;

Singapore prices are the key pricing benchmarks for Australia because Singapore represents the competitive alternative source of supply for Australia.

To meet Australian demand, around 25 per cent of fuel is imported, mostly from Singapore.
Singapore is the regional refining, distribution and trading centre and among the world’s largest petroleum markets.

It sure does say all of those things. The SMH article also says “Furthermore, Australian refineries only produce three-quarters of the petrol, diesel and other products we consume” which is the same as saying 25% of fuel is imported. I fail to see any discrepancy.

The key point here is that crude oil is not a “fuel”, it is a raw material you refine into fuel. The AIP page you link has nothing to say about what percentage of crude oil consumed in Australia comes from overseas.

You’ll also notice that the AIP page says 3 lines down from the top in bold writing that “Australian fuel prices are dependent on world market prices for crude and petroleum products.”

What that says to me is if problems in the middle east cause the world price of crude oil to increase, then there is every reason that the price of fuel in Australia should also increase.

welkin31 welkin31 6:21 pm 15 Mar 11

Seeing petrol in Gungahlin at +$1.50 today got me wondering – I thought world oil price had pulled back a tad. Anyway – through living in Perth pre 2008 I still get their Fuel Watch emails. Here are prices for tomorrow around Rockingham. I see the price hike to $150 coming over there too. But we have had prices higher than these for a fair while.
I know where the BP refinery is but…..
Seems a huge disparity.
I found Fuel Watch v useful and I think it was a shame the Govt plans to take a similar scheme national in early 2008 got shafted by opponents.
The essentials of how FW works in Perth is –
[1] about 3pm each day you get an email saying what the next days prices will be for your chosen area – and you can search online for any WA site. So you can plan to either top up that night or wait.
[2] Servos can not alter prices during the day. So you can plan a trip with a fair confidence of filling somewhere at a known price. Or if you see a good price outbound you know it will not change that day on your return run.

Anyway – extract from FW email
ULP PRICE HIKE ALERT
====================
Some BP sites are hiking their ULP price tomorrow by up to 11 cpl to 149.9 cpl. However, there will be over 220 Perth sites selling below tomorrow’s metropolitan average of 138.6 cpl

Fuel prices from 6am for tomorrow Wednesday, 16 Mar 2011:
Type Tomorrow
16/03/2011 Today
15/03/2011 Outlet Address
ULP 136.9 138.9 Caltex Baldivis Safety Bay Rd cnr Baldivis Rd, BALDIVIS
ULP 136.9 138.9 Caltex Woolworths Port Kennedy 12 Saltaire Way, PORT KENNEDY
ULP 136.9 138.9 Caltex Woolworths Rockingham 29 Dixon Road, ROCKINGHAM
ULP 136.9 138.9 BP Connect Rockingham Park Cnr Read St & Chalgrove Ave, ROCKINGHAM
ULP 136.9 138.9 Coles Express Waikiki Cnr Read St & Gnangara Drive, WAIKIKI
ULP 136.9 138.9 Caltex Woolworths Warnbro Cnr Warnbro Sound Ave & Bristol St, WARNBRO
ULP 136.9 138.9 BP Connect Palm Springs Cnr Warnbro Sound Ave & Halliburton Ave, WARNBRO
ULP 136.9 138.9 Caltex Woolworths Warnbro Fair 202 Warnbro Sound Avenue, WARNBRO
ULP 137.5 138.9 Gull Rockingham 40 Kent Street, ROCKINGHAM
ULP 137.5 138.9 Gull Warnbro Cnr Safety Bay Road & Hokin Street, WARNBRO
ULP 143.9 143.9 BP Waikiki Cnr Safety Bay & Malibu Rds, WAIKIKI

triffid triffid 5:26 pm 15 Mar 11

arescarti42 said :

I don’t know where your figures come from, but this this article suggests that 90%+ of the oil used in Australia is imported, and that the majority of the oil we produce is exported because Australian refineries aren’t configured to refine it.

Further, I’d say that whether Australia is physically reliant on Middle Eastern oil or not is largely irrelevant when the market for oil is global. Issues with supply in the Middle East bump up the price globally, which includes wherever Australia’s oil comes from.

(sigh) So, let me get this straight. The SMH is a more veracious source than, say, the Australian Competition and Consumer Commission (ACCC) or the Australian Institute of Petroleum (AIP)? The Commission’s reasonably extensive investigations into reatil fuel pricing had figures a bit, er, dissonant to those of the SMH, while the AIP website states that;

Singapore prices are the key pricing benchmarks for Australia because Singapore represents the competitive alternative source of supply for Australia.

To meet Australian demand, around 25 per cent of fuel is imported, mostly from Singapore.
Singapore is the regional refining, distribution and trading centre and among the world’s largest petroleum markets.
A recent ACCC report concluded that Platts Singapore pricing benchmarks should continue to be used as the basis for setting fuel prices in Australia.

You can read more at:

http://www.aip.com.au/pricing/facts/Facts_About_the_International_Fuels_Market_and_Prices.htm

Of course, if you’d rather believe what a journo has interpreted as gospel, then, by all means . . .

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