RAA urging tourists to avoid filling up in city
Thursday, 31st December, 2015
Prices might be falling nationally on the back of a global oil glut but motorists continue to pay a premium for petrol in Broken Hill.
It costs 10 cents per litre or more to fill up in the Silver City compared to the national and state average, according to NRMA figures.
That puts the city near the bottom of the motoring group’s weekly ranking of unleaded and diesel petrol prices across 54 NSW country towns.
In the week ending December 20, it moved down one position to 50 on the list, with an average fuel price of 135 cents per litre.
Bega, on the NSW south coast, topped of the list with an average price of 113.4 cents per litre - more than 20 cents per litre cheaper.
So inflated are prices locally compared to metropolitan centres and many other towns that the RAA has been advising members travelling through Broken Hill to carry a jerry can of fuel.
A spokesman said earlier this month that the city was earning a reputation for being “extremely expensive” for fuel, and this was backed up by poor performances in the RAA’s own fuel ratings.
One consolation for locals is that prices are at least falling, albeit at the same rate as other locations, as the major oil producing countries fight for market share by increasing production.
The last time petrol was 135 cents per litre locally was in April.
Oil prices have almost halved this year, falling to an 11-year low below $US40 a barrel as the market gets flooded with more supply in order to push high cost producers out of the market by making prices lower.
CommSec chief economist Craig James said as long as countries like Saudi Arabia are determined to shore up market share, Australian bowser prices will fall.
“While the low global oil price is putting pressure on the profitability of producers, it is clearly good news for consumers,” he said.
“Lower global oil prices have potential to boost economic activity provided that businesses and consumers spend the extra savings reaped at the petrol pump.”
However, Mr James said the variation in petrol prices around Australian remains a concern.
CMC Markets chief market analyst Ric Spooner said the return of Iran as a major oil producing nation will also put downward pressure on petrol prices.
“Iran’s statement that it plans to increase exports by 500,000 barrels a day within weeks of sanctions being lifted is not good news for oil,” he said.
“Iran has also made it clear that it plans to cut prices to restore export market share promptly.”
Sanctions related to Iran’s nuclear program will be lifted in early 2016 in line with a July 14 deal between Tehran and six world powers led by the US. -BDT/AAP