Drivers’ fuel spend finally drops as oil channel shuts
Zac de Silva, Allanah Sciberras and John Kidman |
Australians have slashed their fuel spending for the first time since the start of the Iran war as leaders call for a return to normal oil shipments through the Strait of Hormuz.
Tehran has backflipped on a promise to open the key oil-trading waterway, firing on ships attempting to traverse the strait.
Announcing it would close the trading waterway, Iran blamed an ongoing US blockade on its ports, arguing the move breached a temporary ceasefire.
All countries should work to reopen the strait and put the region on a pathway to long-term peace, Defence Minister Richard Marles said on Sunday.
“What we need to see now is every diplomatic avenue being pursued to turn this temporary ceasefire into one that is permanent, to obviously open the Strait of Hormuz, to return the global fuel supply chain to normality and to put events on a pathway to peace,” he told the ABC’s Insiders program.
Asked if Australia supported US President Donald Trump’s decision to blockade Iranian ports, Mr Marles said he wouldn’t second-guess the move.
“Iran has sought to block the Strait of Hormuz. That is what has happened,” he said.
“And I can understand the American reaction to that.”
Defence Industry Minister Pat Conroy called for the US and Iran to continue peace negotiations.
“One day we hear news, the next day we hear different news,” he told Sky News.
“All we can do as a responsible middle power is to say ‘keep talking’.”
Opposition home affairs spokesman Jonno Duniam said the on-again, off-again closure of the strait was troubling, and backed Prime Minister Anthony Albanese’s decision to join global talks on keeping the waterway open.
Meanwhile, data from Westpac shows Australians are beginning to spend less on petrol and diesel as a cut to fuel excise flows through to the bowser.
In the past fortnight, spending on fuel dropped 3.8 per cent, according to analysis of debit and credit card transactions.
“Seeing fuel spend fall back is a meaningful shift and suggests the fuel excise cut is landing in household budgets,” Westpac consumer chief Carolyn McCann said.
But fuel costs were still higher than before the war and some business sectors that were less able to pass costs on quickly were under increasing pressure, she said.
While recent falls in global oil prices were translating to cheaper fuel, markets remained volatile, National Roads and Motorists Association spokesman Peter Khoury said.
“Wholesale prices have been falling and they should continue to fall,” he told AAP.
“We are focusing on the wholesale prices in Australia because that’s the clearest indication of what’s going to happen at the bowser.
“It takes about seven to 10 days for those falls in oil prices to flow on in the Australian market.”
Reprieve aside, Mr Khoury urged motorists to remain cautious, saying it was still unclear whether the cheaper fuel would last.
“Trying to predict what’s going to happen in the Middle East is the quickest way to get made a fool of yourself,” he said.
Australasian Convenience and Petroleum Marketers Association’s Rowan Lee said fuel price pressures were expected to continue for at least the next six months.
“It’s just really uncharted territory and that is not underplaying it,” he said.
AAP