Finance Consumer Petrol prices break new records in Sydney and Melbourne as lockdowns ease

Petrol prices break new records in Sydney and Melbourne as lockdowns ease

petrol prices
Australian petrol prices have broken records. Photo: Getty
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Motorists are being slugged with soaring petrol prices as lockdowns ease in Sydney and Melbourne, with bowsers hitting record levels on Monday.

In a double whammy, rising global oil prices have combined with retailer price cycles to drive a 10 per cent rise in bowser prices across Sydney since October 10 – pushing prices to a record 170.4 cents per litre.

In Melbourne, they have risen 15 per cent to 174.7 cents per litre.

National Roads and Motorists Association (NRMA) spokesperson Peter Khoury said the price rises “could not have come at a worse time”, with Sydney and Melbourne motorists now hitting the road after lockdowns.

“We are now seriously concerned that there is little relief in sight and that is bad news for families and the economy,” Mr Khoury said.

“These prices are going to hurt family budgets and the importance of doing some research before filling up has never been clearer.”

Motorists in Sydney and Melbourne are being advised to either fill up now, or wait until prices start easting in about a week’s time.

Source: Motormouth (click to enlarge)

Why petrol prices are rising

Two key factors are driving up petrol prices.

First, retailers in Sydney, Melbourne and Brisbane are currently raising rates under a periodic price hike cycle that happens every month or so.

This feature is unique to these three cities.

Retailers raise and lower bowser prices in a regular pattern, with big chains pushing up prices first until eventually independents try to undercut them, pushing prices back down across the entire market.

But these cycles fail to explain why prices have hit levels not seen since 2008.

That’s due to global oil prices rising sharply amid a “global energy crisis” in North America, Asia and Europe.

Australia’s benchmark fuel price, the Singapore Mogas, hit a three-year high last week at 81.68 cents a litre.

Oil prices are rising around the world because demand has picked up as major economies in Europe and North America reopen, while key suppliers like the OPEC+ nations have voted to keep a lid on supply.

Prices will start to ease in Australia over the next two weeks as the price hike cycle begins to fall into its discounting phase, but don’t expect it to fall to the same level it did previously because oil prices are still rising.

This also means we’re likely to see another fuel price record broken in Australia the next time prices begin to cycle upwards during November.

In fact, prices are expected to increase through to Christmas, because global oil prices remain close to eight-year highs.

Advice for motorists

If you’re in Melbourne, Sydney or Brisbane, and can wait a few weeks to fill up, then you’ll find lower prices once the price cycle eases off.

If you need to fill up over the short term, the ACCC says prices haven’t peaked yet, so the sooner the better.

A fuel comparison app would help save you money.

Motorists outside Australia’s largest cities face different market trends.

In Perth, prices are regulated and rates change routinely, while in Adelaide, prices are hitting the bottom of the price cycle so it’s a good time to fill up the tank.