Petrol prices Sydney, Melbourne, Brisbane: Expert reveals reason for huge fuel costs

An expert has revealed what is behind soaring petrol prices in Australia as motorists continue to experience pain at the pump.

The pandemic and international conflict are to blame for fuel prices in Australia soaring as hundreds of pumps start charging upwards of $2 a litre.

The insight comes as fuel costs have fluctuated wildly since the onset of Covid-19, due to supply chain issues and people’s changing behavior.

Prices first bottomed in the first wave when punters could expect to pay just 84 cents per litre.

Australasian Convenience and Petroleum Marketers Association CEO Mark McKenzie said the cost of fuel was largely dependent on the wholesale price.

“The story here is tied to wholesale pricing, which is tied to global markets,” he told 3AW..

“The wholesale price is currently $1.79, which is what gas stations pay for fuel to be delivered to their site.

“Then you add their retail costs, all the costs associated with their lease, their business costs and the small margin that comes with that.”

“The price you and I pay at the pump is 85% wholesale and 15% retail.”

Mr McKenzie also explained how the standard price had more than doubled since the start of the pandemic.

“A lot of it is because I can’t turn a refinery off and on like a light switch,” he said.

“I have to wind it up and slow it down, so all the global fuel refiners are pretty conservative in predicting how quickly the savings will recover, and they’re consistently wrong, which drives that price up.”

He said the Russian-Ukrainian conflict had pushed prices up another 20% since December.

Prime Minister Scott Morrison has weighed in on the issue, insisting the price spike is temporary.

“The advice we’re getting, particularly from the International Energy Agency, is that its impact is likely to be short-term; it will probably be temporary,” he told the ABC..

“Now you’re not going to completely recalibrate your budget based on fluctuations in oil prices – they’ve gone up, they’ve gone down. And so we would need to assess what the longer-term impact would be.

Labor leader Anthony Albanese blamed the government for the price spike, noting the closure of refineries.

“Fuel prices have skyrocketed under this government,” he said.

“Half the refineries in Australia have closed during this government term. This government has not fulfilled its obligations to the International Energy Agency for fuel reserves.

“And Angus Taylor said we’re going to have fuel reserves – they’ll be in the Gulf of Mexico.”

Previous Avian Influenza Found In Delaware Chicken Flock; Producers Urged To Take Precautions
Next Readiness report: Raiders, Bluejackets claim upset wins - Reuters Sports News