Singapore sling affected fuel price

By: Samantha Freestone

Experts say word on the street is that Singapore refiners artificially inflated the price on unleaded fuel in February

It’s rumoured Singapore refiners artificially inflated the price of unleaded fuel in February and it impacted diesel prices last week, experts say.

As Australia’s fuel price is based on Singapore prices to regulate our own domestic fuel levels, the unusual rise impacted on Australia.

But, unleaded and diesel "should track the same" in the next week and beyond, according to General Manager of Fuel Trac Geoff Trotter.

"Whatever they did, they only got away with it for a few days. We thought something very dodgy was going on. We were very suspicious really.

"Diesel prices have been relatively stable. Since the 24th of February the price of unleaded and diesel have both increased in Singapore but they are tracking the same now. Whereas back from the 13th [of February] there was a huge discrepancy.

"The problem with it was you can see that apart from that period the price of diesel and unleaded were basically the same."

A price differential of 8-16 cents a barrel between crude and diesel can be expected but because of the "highly unusual spike" an additional 5 to 10 cents fell on the shoulders of consumers.

"Now we are seeing the prices come back down again," Trotter says.

Looking forward, Fuel Trac expects a target range of US$55 a barrel in the coming months.

"We base our projections on an exchange rate of 65 cents to the US dollar. That gives you an underlying price of 85 cents per litre," Trotter predicts.

Additionally to that base price, is GST, import taxes, excise and a wholesale margin of 7 cents per litre, Trotter says.

Trader Business Media titles ATN, Owner//Driver and ABC now publish a summary of terminal gate diesel prices across key capital cities every week. To view this data, available only to subscribers, click here.

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