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Motorists are feeling even further pain at the bowser, and the signs are it will only get worse as global oil prices rise on escalating political tensions between the Ukraine and Russia.
Prices hit a fresh seven-year highs on Monday with Brent crude oil above $US95 a barrel as speculation of Ukraine-Russia conflict mounts.
Commonwealth Securities senior economist Ryan Felsman said oil prices have already risen for eight successive weeks on market expectations that crude demand will outpace supply as the global economy rebounds from Omicron variant disruptions.
“Rising geo-political tensions in Eastern Europe could be the major catalyst needed to justify crude oil’s potential move above US$100 a barrel,” Mr Felsman said.
Meanwhile, rising oil prices are feeding into petrol prices in Australia.
The Australian Institute of Petroleum said on Monday the national average retail unleaded petrol price rose by 5.1 cents in the past week to a fresh record high of 176.9 cents per litre.
The institute said the petrol price hit record highs of 182.3 cents a litre in Melbourne, 185.2 cents in Hobart, 177.3 cents in Canberra and 181 cents in Perth.
“Filling up the car with petrol is one of the single biggest weekly purchases for consumers, with inflation and cost of living pressures a focal point in recent consumer sentiment surveys,” Mr Felsman said.
“Assuming the purchase of 35 litres of petrol per week, Aussie households are currently spending $247.66 a month on petrol.”
The annual rate of inflation rose by 3.5 per cent over 2021 and above the Reserve Bank of Australia’s two to three per cent target, led by a 32 per cent increase increase in fuel prices.
Rising inflation, along with a falling unemployment rate, are key factors behind expectations of an interest rate rise by the central bank this year.
Many economists are predicting a move in the cash rate in August, by which time the RBA would have had time to consider two further quarterly inflation reports.
Colin Brinsden, AAP Economics and Business Correspondent
(Australian Associated Press)