Why is this not making the headlines on the TV news?
and more importantly, why are we not starting to see big reductions at the bowser? Strange considering prices have been on a par with the lows we saw in January this year.
WTI Crude Oil hit $40.51 USD per barrel at 7.50pm 20/08/15. http://www.dailyfx.com/crude-oil
Lowest price since November 2003 http://www.macrotrends.net/1369/crude-oil-price-history-char…
I remember seeing petrol for less than a dollar per litre in 2005 when prices were around the mid 50's per barrel.
It was 63cents a litre in '95. I remember cos we went to the UK the same year and it was 63p per litre (which worked out about $1.40aud per litre)
It was sixty something cents per litre in 99 as well - because I remember paying that much filling up my first car.
Any deals on 44 gallon drums?.
yes, can be found for free in industrial areas
So Why………..
not look at previous posts
31/07/2015 Petrol in Melbourne Today (31/07/2015)
09/06/2015 Petrol Stations Price Gouging/Colluding
11/09/2014 What's happening to petrol prices in Sydney?
04/03/2014 If you need petrol, fill up asap! Prices going up 22c
Report of the ACCC inquiry into the price of unleaded petrol
Not very helpful as most of these posts are from before the current record lows we are getting now.
They're relevant - fundamentally it's the same question and answer as to why TAPIS/Brent prices doesn't quite translate to a lower price at the bowser.
In Australia we don't have WTI we use Tapis which is not a cheap as light sweet
WTI, Brent, Tapis, all are seeing massive falls to historical lows.
Fracking, shale oil and Iran is about to come online = oil glut.
Was just reading somewhere it would be no surprise to see prices go as low as 15-20 usd a barrel.
Bring back more family car V8s!
should i invest??
Maybe OzBargain should form a nation and bulk buy oil from the Middle East?
The price-per-barrel is currently severely reduced because for quite some time now, the 'big players' in the middle-East (etc.) have been 'flooding the market' with crude in an effort to hurt the frackers (et al.) in the the USA and elsewhere (i.e. in an effort to render their operations non-viable, financially). It's a 'price war', of sorts. I say embrace it, it is keeping the price at the bowser lower than it otherwise would be, for now.
I wouldn't be buying a SUV in the expectation that oil will fall more or stay low.
As Gnarly says, this is a price war. The OPEC nations (well, the Saudis) are threatened by US shale. They want to push prices so low the shale drillers are forced to default on their borrowings, in the hope it will limit shale drillers access to funding in future. As you can imagine, a bank will be reluctant to lend money to drill new wells if it knows the Saudis can send them broke whenever they want.
That will reduce competition longer term, so the middle east will then be able to support a price a bit higher once the shale drillers are dealt with.
The other half of the equation is demand.which has been subdued. Some argue it is subdued because people are moving to greener energy sources. I think it is more a reflection of the poor economic conditions in much of the world.
Why aren't we seeing lower prices? Oil is low in USD, but not in AUD. If you do your spending in USD you will see that prices are already under $1 a litre. When the AUD/USD rate was near parity we benefitted from cheaper access to petrol. Now fuel costs about 30% more due to exchange rates alone.
Note also the government fuel excise is calculated per litre, not in dollar terms, so fuel is 38c per litre excise, regardless of whther the per barrel price is $100 or $50.
They are around $1.17 for Unleaded here (North Brisbane) at the moment, with some stores at $1.47 scattered around.
I saw one store at $1.47 for just a day, and then it flipped back to $1.17, like those around it. I think they're trying to do the High to Low Rotation thing, but it's not working anymore.
Paid $1.19 for fuel yesterday in Brisbane.
Just imagine how cheap it might have been if the exchange rate to USD hadn't gone down so much over the past 6 months!!
I read that refining capacity is quite low, oil companies have shut down refineries in Australia. Here's an old article but I think it's relevant.
http://www.smh.com.au/business/mining-and-resources/bp-refin…
Just came back from the US where unleaded is selling in the middle of the Arizona desert for US$2.95 per gallon. That works out at AU$4.21 per gallon or 93.5c per litre. And remember this price includes haulage to a remote location (Kingman) So that is the true price allowing for the US/AU exchange rate. Boy are we being ripped off badly. Someone has a lot of explaining to do. Me thinks the blame is shared equally between the oil companies and govt taxes.
We pay 38c per litre fuel excise. That pays for roads and hospitals. If you think tax could be better collected more effectively another way, please suggest it.
If you think tax could be better collected more effectively another way
I wouldn't mind paying the excise if all the money went back into roads and transport. The reality is that less than a third goes into road infrastructure.
http://www.mynrma.com.au/blog/2014/05/08/nrma-to-fight-any-u…
True.
But the gov has to pay for other things too. Are we going to cut the pension or something else to lower petrol prices?
@mskeggs: I'm not suggesting reducing govt revenue or spending. But I do think there are far more equitable ways of taxing people.
Whilst all the given reasons why the Saudis want to keep the price low is plausible consider this whole excercise is mearly a conspiracy with the USA to send Russia broke again. They successfully used exactly the same strategy to break up the USSR between 1985 and 1998. Dont forget that oil is also Russia's biggest export and income earner. Back then oil was kept artificially cheap for over 10 years. So whilst competition and Saudi dominance looks like the reason for cheap oil on the surface, deep down there are strong polical currents with the Saudis being very good friends with the Americans !
Why would the Americans need the excuse to offer low prices? They are the world's largest energy user, they are always desperate for low oil prices.
And unless you are in the Ukraine, what real threat or competition is Russia?
very likely the reason, but not very easy for the masses to swallow.
Luck you aren't in Townsville, the price seems to be locked at $1.42-$1.45.
Amazingly prices in towns north and south of Townsville are lower even though the petrol actually travels through Townsville to get there.
That's ridiculous, and proof of blatant collusion/price fixing.
Yep, fuel in Cardwell is always cheaper than in T'ville, go figure?
Paid $1.47 a couple of days ago in Sydney's northern beaches. Price hasn't gone down a cent. Last big drop to $50 I saw $1 on the board, you can't tell me that the oz$ weakness doesn't equate to no drop whatsoever.
They r taking the p*iss……
Yep, The australian consumer is at the whims of a small cabal of companies… when the oil prices go up, the VERY NEXT day prices skyrocket
and yet its $40 a barrel… lowest in SIX YEARS and yet… we still get raped at the pump
Drove past it today and a miracle has happened…..$1.26. Like Woolies is ready with us
Crude oil and refined gasoline are two different things. Refineries are shutting down left/centre/right around the world. Your sweet sweet crude is super cheap, but with the reduced economies of scale in production (due to the shutdowns), your pricing on gasoline will forever stay high.
Shame none of the car manufacturers have made a car that runs on crude oil then I suppose..
MARGINS have grown across the board, while the barrel price has dropped they all have the exact same margins, Used to be they would make 2-3c per L, now its average is 15-30c PER LITRE at the pump. Competition will result in lower prices but not the drop back to $1 per LITRE (or less) despite pre 2001 fuel prices. The exchange rate is HIGHER now than then (1.55 v's 1.70-75 now), the barel price was $60, now sub $40, so we should be looking at 75c/L petrol minim! DONT HOLD YOUR BREATH BUT
Because the Prime Ministers and Presidents are appointed puppets from the owners of Big Oil.
Simply, they can't.
The govt isn't in a hurry for petrol prices to drop because they get 10% of the income in GST for every litre sold so for them the higher the price the better.
$1.15 on the Gold Coast (with Woolies 4c off)
But they will blame the Aus to US dollar rate and put it up soon to $1.50.