Families feel the pinch as a weak Australian dollar pushes petrol prices to a five year high
- Weak Australian dollar has pushed petrol prices to five-year high across country
- Households are feeling the pinch as buying petrol is eating into their incomes
- ACCC released their quarterly report, outlining the average annual prices
- Average annual petrol prices were 7.0 cents per litre higher than those last year
- This is the highest annual average of petrol prices in Australia in five years
- Families spend an average of more than $44 per week just on petrol alone
The weak Australian dollar has pushed petrol prices to a five-year high, a new report has claimed.
The average annual price of petrol is currently 7.0 cents per litre higher than last year, according to the report by the Australian Competition and Consumer Commission (ACCC).
Retail petrol prices increased significantly in the June quarter of 2019, with average prices across the five largest cities sitting at 145.3 cents per litre.
The weak Australian dollar has pushed petrol prices to a five-year high and families are feeling the pinch
In the five largest cities – Sydney, Melbourne, Brisbane, Adelaide and Perth – unleaded petrol averaged at 141.2 cents per litre in the past year.
This was an increase of 6.7 cents per litre on the previous year and is also the highest annual average in the past five years.
The consumer watchdog says the main driver of the high petrol prices is the depreciation in the AUD-USD exchange rate.
‘The most significant contributor was the depreciation in the AUD–USD exchange rate which decreased by USD 0.06 to USD 0.72,’ the report said.
‘This was the lowest annual average AUD–USD exchange rate in the last 15 years.’
The exchange rate between Australia and the US is a significant determinant of petrol prices as international refined petrol is bought and sold in US dollars in global markets.
According to The Sydney Morning Herald, families spend more than $44 a week on petrol.
This makes fuel the most expensive regular purchase for families, which has jumped 5 per cent since 2017-18.
Households are already feeling the pinch when it comes to prices of essential goods and services in government-dominated sectors while prices fail to rise.
Petrol prices have been slowly rising over the past five years and is eating into household incomes across the country, a new report shows
ACCC chairman Rod Sims said petrol prices in Australia will continue to rise as long as the Australian dollar continues to fall.
‘The Australian dollar–US dollar exchange rate is a significant determinant of Australia’s retail petrol prices because international refined petrol is bought and sold in US dollars in global markets,’ Mr Sims said.
However, ACCC also noted that a significant development earlier in the year in the petrol industry was due to the change in agreements at Coles Express to Viva Energy and Woolworths to EG Group.
Prices in regional areas were seen to be lower than those in capital cities with prices ranging from 2.1 cents per litre to 6.5 cents per litre.