Rising Australian dollar should help curb petrol price gains
By Colin Brinsden29 Jun 2009 4:52 PM
CANBERRA, June 29 AAP - A strengthening Australian dollar should help petrol prices stabilise around current levels after hitting a fresh eight-month high last week, an economist says.
The weekly Australian Institute of Petroleum report showed the national average unleaded petrol price rose further by 1.4 cents per litre in the past week to 125.7 cents.
Prices rose in all states and territories apart from Tasmania, where it stayed at an above average 128.6 cents per litre.
The average price in metropolitan areas rose 1.7 cents per litre to 126.2 cents, while the average regional price rose 0.7 cents to 124.7 cents per litre.
The national average pump price has risen some 10 cents after increasing over seven consecutive weeks, but remains well below the peak of near $1.50 a litre reached nine months ago.
Commonwealth Securities economist Savanth Sebastian said the stronger Australian dollar had been insulating motorists from the rising global oil price to some degree, saving around 25 cents a litre since March.
"Importantly over the last week the global oil price has moderated, while the Aussie has managed to hold above 80 US cents," he said.
"The good news is that with oil prices holding around current levels, pump prices should stabilise around $1.25 to $1.27 a litre."
He said while a global economic recovery may see the oil price rise in the longer term, the Aussie is expected to follow suit.
Commonwealth Bank currency strategists are forecasting the Aussie will end the year at 84 US cents and reach 89 cents by June 2010.
