Petrol prices have shot up to their highest levels since March, with the 14.1-cent rise in the national average unleaded fuel price seeing its third-biggest increase on record.
According to CommSec estimates, the national petrol price stood at $2.06 a litre yesterday, marking the highest price since the peak of late March.
Craig James, chief economist at Commsec, expected fuel prices to return to record levels.
“Petrol is the single biggest weekly purchase for most families and is currently a major influence on consumer sentiment,” James said in an analyst note.
“Higher fuel prices, together with the recent rate hike, constitute a double whammy for Aussie families,” he said.
In March, prices spiked well over $2 a litre until the fuel excise was temporarily cut in the 2022 Budget, helping to bring prices back down to around $1.60 a litre.
But now, the following Commsec chart shows prices trending sharply upward:
Adelaide is seeing the highest average fuel prices, according to data from MotorMouth, with prices sitting around $2.13 a litre.
Petrol is also particularly expensive in Brisbane, where the average price for unleaded fuel is around $2.16 a litre.
Canberra has the lowest average fuel prices at the moment of around $1.95 a litre.
What’s pushing up fuel prices?
James said wholesale prices spiked last week, with the benchmark Singapore MOGAS 95 unleaded price jumping 9 per cent higher - in US dollar terms - to record highs.
“In Australian dollar terms, the increase was over 14 cents a litre as the Aussie dollar hit a 22-month low against the greenback,” he said.
A fire at a South Korean refinery last week was expected to exacerbate supply shortages due to diminished refining capacity.
The European Union ban on Russian oil also continued to drive up oil prices.
On the other hand, China’s zero-COVID strategy helped to reduce demand.
But this demand will gear back up again if Shanghai emerges from a COVID lockdown on June 1 as anticipated.
However, new production was forecast to enter the market within a few months, with the US and OPEC expected to keep increasing output.