The Australian Institute of Petroleum today advised that rising demand and tight supplies in the international petroleum markets was continuing to put upward pressure on pump prices in Australia.
"There are a number of coincidental international factors at work in the market that continue to put upward pressure on the price of petrol. These include:
- The recent OPEC decision to continue to hold production, which has caused some, supply tightness and higher crude prices.
- Market nervousness over crude supplies in the event of any punitive action against Iraq.
- Strong demand for product in the USA as their economy appears to be strengthening.
- Unplanned outage of Shuaiba Refinery in Kuwait.
- Closure for maintenance of the large Yanbu Refinery in Saudi Arabia.
- Decision by Saudi Arabia to cut Naphtha Exports to Asia by 30/40% which further tightens the petrol market.
- Rush to stock up on supplies in anticipation of the planned, March to May maintenance period for refineries in Asia."
The Institute Director, Mr Bryan Nye, said today.
"These factors have led to a continuing increase in the price of petrol ex-Singapore which is the benchmark for prices in Australia. We have already seen prices above 90c in the last week and if these pressures continue in the international sector, prices can only rise higher."
However, as we have seen in the past the highly competitive market in Australia also sees prices drop just as quickly when international pressure eases.
These international factors are beyond our control and there is no capacity for oil companies to avoid price increases. Considering the industry made an underlying loss of $160 million last year, any suggestion that the oil companies are colluding or profit taking in any rise is ludicrous.