ALREADY many Brisbane petrol pumps are pushing above $1.80 a litre but with war breaking out between Russia and Ukraine, Australians are bracing for a price surge.
Catholic Social Services Australia chair Francis Sullivan said record petrol prices would impact low income earners and welfare recipients the hardest.
The national average petrol price was $1.79 per litre last week.
“The facts are that higher petrol prices impact low-income earners the hardest as much more of their weekly income is spent filling the tank compared to others on higher incomes,” Mr Sullivan said.
“Just small increases in the cost of petrol, electricity, food and other non-discretionary goods and services can have a devastating impact of people living from pay packet to pay packet or on benefits.
“On top of this, real wages for ordinary Australians are going backwards according to the latest wage price data from the Australian Bureau of Statistics which shows a 1.2 percentage point gap between inflation and wage growth.
“Economically many Australians are going backwards and the most disadvantaged, the low income earners, single parents, homeless and underprivileged, are being hit the hardest.”
Petrol prices have increased for the average household by $67 in the last year alone, according to the Australian Institute of Petroleum.
This means the average household is spending upwards of $250 a week on fuel.
The reason for the overwhelming price hike was because global oil stockpiles were at seven-year lows because of the lack of travel during the pandemic.
This, mixed with subpar supply growth since then, has led to a disparity between supply and demand as commuters pick up their routes again.
War often brings higher petrol prices.
But with Russia, the world’s second-largest exporter of crude oil and refined petrol, this is expected to be even worse as the nation diverts its fuel to military uses, supply lines become riskier, market confidence is shaken and economic sanctions sink in.
Australia meets its fuel needs by relying on the international market to import crude oil to refine locally or importing refined petrol directly.
This means Australia is set to feel these international shocks in the coming weeks.
Mr Sullivan said with an election likely in May, cost of living concerns will become a major issue for both the Coalition and Labor.
“A recent poll published in the Nine newspapers shows 43 percent of voters feel their income will fall after taking into account inflation while another 10 percent expect to earn less because they will work fewer hours or have their pay cut,” he said.
“Both major parties need to recognise that, despite low unemployment, there is a very large part of our community that will struggle to make ends meet as the cost-of-living increases.
“Before the election there needs to be a very clear message from both sides as to how the next government is going to ensure people struggling economically will be able to keep their heads above water and enjoy just some of the benefits most of us take for granted.”
