Fuel costs up 40% in 12 months

THE Australian Automobile Association (AAA) has this week released its annual Transport Affordability Index showing average weekly fuel costs rose 40 per cent in the 12 months the March 31, 2022.

 

The AAA says the results indicate the impact of global events including the war in Ukraine, and changing vehicle purchase patterns, which in turn impact car repayments, adding to average weekly household transport costs.

 

Data from the report suggests the average weekly household transport cost in a capital city is $401.05 and $330.67 in regional households. The increase varies between states, with the average weekly jump on fuel prices varying from between $26.49 and $96.65 depending on location.

 

“Rising fuel prices continue to be a significant contributor to cost of living pressures across both regional and metropolitan Australia,” said AAA managing director, Michael Bradley.

 

“Fuel costs have risen an average of between $26.49 to $93.87 per week over the past 12 months in capital cities with Hobart ($100.18 per week), Sydney ($94.80 per week), Darwin ($94.36 per week), Brisbane ($93.93 per week) and Melbourne ($92.07 per week) the most expensive capital cities.

 

“Regionally costs are more expensive, rising on average $27.89 to $96.65 per week with Bunbury ($116.31 per week), Geelong ($110.69 per week) and Launceston ($109.37) the highest.”

 

Mr Bradley said car loan repayments had fallen as the main transport cost across the country as a greater proportion of motorist chose cheaper new vehicles.

 

When included in average weekly transport costs, Sydney remains the most expensive capital city at $474.43 per week, followed by Melbourne ($447.83) and Brisbane ($445.69).

 

The AAA says the introduction of a zone cap for public transport in Perth has also had an impact with the Western Australian capital dropping a spot to fifth on the rankings, with Canberra now more expensive.

 

The dearest regional cities for transportation include Bunbury (WA) at $35.05 per week, Alice Springs (NT) at $350.45 per week, and Geelong (VIC) at $347.69 per week.

 

Mr Bradley says that as a percentage of household income, transport costs now account for 14.7 per cent of the annual wage, with centers including Launceston, Hobart and Brisbane well above that average with proportions of 18.1, 17.9 and 17.1 per cent respectively.

 

The news comes just five weeks after the cut in fuel excise came into effect. Retail fuel prices have receded in all capital cities and in most regional locations since the invasion of Ukraine saw a significant spike in the price at the bowser this February.

 

The Australian Competition and Consumer Commission (ACCC) says the cuts to the fuel excise have clearly been passed on to a large extend, but that other factors have contributed to the lowering of the retail fuel price, including a decrease in international refined petrol prices across April.

 

In the five largest capital cities across Australia, the price of regular unleaded petrol between March 29 and April 26 has decreased more than 39 cents per litre (cpl) with prices in Canberra, Darwin and Hobart dropping by between 25 and 48cpl.

 

However, the ACCC says that the existence of petrol price cycles, particularly in Adelaide, Brisbane, Melbourne, Perth and Sydney, means that the impact of the cut in excise on retail fuel prices may not be clear to motorists.

 

During April, the peak price of petrol in Perth was 181.6cpl, 32 cents lower than the previous peak price of 213.1cpl on March 23. Adelaide showed a similar decline with the April peak price of 187.8cpl down 33 cents on the peak price of 220.6cpl on March 12, while Melbourne prices fell 31 cents to 187.0cpl.

 

The ACCC says it expects a similar pattern to follow in Brisbane and Sydney as prices in those cities move to the next peak as part of regular cyclical movements.

 

Petrol prices in most regional centres are also significantly lower, says the ACCC, with the average decrease from March to April noted at 31 cents per litre.

 

ACCC monitoring suggests diesel prices have also been reduced in many locations. In the capital cities, between March 29 and April 26, the decrease in the average price of diesel was more than 30cpl in Adelaide, Brisbane, Melbourne, Perth and Sydney, and between 29 and 32cpl in Canberra, Darwin and Hobart.

 

The agency says diesel prices in many regional centres are also lower, with the average decrease across all regional locations the ACCC monitors down an average of 29cpl from March to April.

 

“There are a relatively small number of locations in regional areas where the decrease in petrol and diesel prices has so far been smaller than the cut in excise. The ACCC is analysing price data in these locations further to determine its next steps,” it said in a statement.

 

Globally, the average price of refined petrol sits at $US1.33 ($A1.87). However, there is a substantial difference in petrol prices between countries.

 

Website Global Petrol Prices says that, as a general rule, richer countries have higher prices while poorer countries – and countries that product and export oil – have lower prices, with the USA being “one notable exception”.

 

The website says the differences in prices across various countries are due to solely to the various taxes and subsidies imposed on liquid fuels, and that all countries have access to the same petroleum prices within international markets.