Petrol prices have hit a six-year low in
Melbourne and in some parts of Sydney as the price of fuel dropped to
99.9 cents at some service stations.
The current trend of selling unleaded
fuel for less than a dollar a litre is expected to be the beginning of a
run of low prices around the country. It followed a national trend,
with Australian prices falling to their lowest level since May, 2009
earlier this month.
Petrol prices have plummeted since last year as global oil halved from more than $100 a barrel to less than $50.
According to the Royal Automobile Club of Victoria (RACV) fuel spokesman Michael Case said,
it was the first time unleaded petrol had dipped below $1 a litre in
Melbourne in six years. “The previous low was at the beginning of 2009
after the global financial crisis,” he said. “We’re now in our fourth
month of continual decreases of retail fuel prices. It’s has just been
going down, down.”
It marks a low in Melbourne petrol
prices, which have plunged from more than $1.50 a litre since last year,
and follows a similar drop in prices for Sydney motorists filling up
with E10 last week.
RACV said the average price for unleaded
across the city on Tuesday was $1.06 a litre, but it said some petrol
stations were selling it for 99.9 cents. Prices at nearby outlets in
Sunshine, Yarraville and Newport were about 5¢ a litre more expensive on
Tuesday and the average price in Melbourne was 106.2¢ a litre,
according to price comparison website Motor Mouth.
Michael Case from the RACV said the good
news for motorists was set to continue. “Petrol prices have been on the
way down continuously since early October,” he said. “The
wholesale price of fuel has been trending down now for around three
months and there’s no sign of that changing in the short term.
“We expect fuel prices will continue to
decrease, at least in the short term. It’s much less than what motorists
have been experiencing for years in the vicinity of $1.50, so much
cheaper and good news.”
“[There’s] a lot more people on the road
travelling longer distances than normal, so it will mean cheaper
motoring and it’s good for household budgets and the economy in
general.”
But country areas had not been so lucky.
“There are some regional centres that
are yet to have decreases in line with what’s happened in Melbourne,” Mr
Case said. “Motorists would expect to pay more, because of transport
and supply-related costs, but even so the extra cost should be in the
order of 5-10 cents. But there are a number of regional centres with
much higher prices than they should have, given the recent decreases in
world oil prices.” Mr Case also said the cost of diesel was too high
across the state and retailers should start moving to reduce the price.
AMP’s chief economist, Shane Oliver, said
motorists filling up for 99.9¢ a litre would save about $20 a week. He
said inner-city outlets were likely to start discounting petrol to
remain competitive. “We saw in Sydney when it did go down to 99.9¢ a
litre, within a week other service stations started pushing towards
102¢, 103¢. I can’t see them all going below a dollar straight away, but
whichever way you cut it it’s good news.”
The national average price of unleaded
petrol last week dropped from 119.7¢ a litre to 115.7¢ a litre,
according to the Australian Institute of Petroleum. Prices in country
areas remain higher than the city, with the average metropolitan price
111¢ a litre compared with 125.2¢ in regional areas.
Mr Case said while it was impossible to
predict how low petrol prices would drop, drivers would continue to save
at the bowser in the short term. “With wholesale prices continuing to
decline, there’s no reason why the retail price should not also continue
to decline,” he said.
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