Petrol prices fall below $2 per litre, amid oil market uncertainty

Australian motorists are enjoying relief as petrol prices fall from Easter highs, but a recent bump in oil prices has prompted retailers to keep bowsers close to $2 per litre.

After the national average petrol price stabilised last week, rising 0.1 per cent to 191.4 cents per litre (cpl), MotorMouth data shows bowsers are falling across the nation’s biggest capitals.

Since peaking over Easter, average prices have fallen 2.4 per cent to 191.7 cpl across Sydney, by 3.8 per cent to 195.2 cpl in Melbourne and 3.5 per cent to 200 cpl in Brisbane.

The slow pace of falls is expected to continue over the next week, giving motorists in big cities an opportunity to fill up before the next swing in east coast market cycles sends prices up again.

But with bowsers still hovering close to $2 a litre it appears retailers will reset the market higher than earlier this year, with a bump in oil prices during April putting pressure on local fuel bills.

Global crude oil prices have risen 5 per cent from a 2023 low in March to $US78 ($116) a barrel after OPEC decided to curtail output earlier in April in response to slowing growth.

Oil has eased from an April peak of $US82 a barrel ($122) in the past two weeks.

“Last week, oil’s rough week had too many holes poked into the short-term crude outlook,” OANDA analyst Edward Moya said on Tuesday.

“But some of that pessimism might go away this week if earnings continue to impress and if the US quarter posts a solid 2 per cent or better reading with first-quarter GDP.”

Local petrol prices ease

The surest sign that higher oil prices have begun flowing through to local bowsers can be seen in petrol price trends in smaller Australian cities, which aren’t subject to the same east coast price cycles that motorists in Brisbane, Sydney and Melbourne have to deal with.

Average petrol prices have risen 2.19 per cent in Canberra since Easter to 190.7 cpl, by 2 per cent in Darwin to 183.4 cpl and 1.7 per cent in Hobart to 193.8 cpl, according to MotorMouth.

Source: MotorMouth (click to enlarge).

In Perth and Adelaide, where bowsers follow a routine cycle of troughs and peaks in any given week, average prices have remained relatively stable over the same period.

The Australian Competition and Consumer Commission (ACCC) have told motorists in Brisbane, Melbourne and Sydney that prices are likely to continue falling across those cities.

That means that while it’s a relatively good time to fill up now, better deals are around the corner.

Oil price outlook

The outlook for oil prices remains mired in uncertainty, with OPEC’s recent move to cut oil production leading to a bump in prices during April before a fall in the past week.

ANZ Bank analysts Brian Martin and Daniel Hynes say the “excitement” around OPEC’s surprise output cut has faded, with an easing of supply disruptions pushing prices lower.

“Russian exports bounced back above 3mb/d last week. The recent disruption to supply from Iraqi Kurdistan has also eased, with exports to Turkey resuming,” they said.

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