Money & Banking

Petrol prices to drop amid coronavirus outbreak

Petrol prices to drop amid coronavirus outbreak

Petrol prices could drop to as low as $1 a litre across Australia after Saudi Arabia started an oil price war with Russia.

Global oil prices are expected to continue falling after Saudi Arabia and Russia failed to agree on oil production targets over the weekend, prompting Saudi Crown Prince Mohammed bin Salman to announce an increase in the country’s production from nine million barrels to 11 million barrels per day.

Brent crude prices dipped 29 per cent from US$45 a barrel on Friday to US$32 a barrel on Monday.

Some analysts predict oil prices could plummet to US$20 per barrel.

The prices were already under pressure from COVID-19, which had reduced demand from China.

Treasurer Josh Frydenberg said on Monday he had asked the Australian Competition and Consumer Commission to monitor the prices at the bowser.

“They have assured me that they will not only maintain their monitoring role and the vigilance that that involves, but they’ll also be calling out any energy companies that don’t pass on the reduction in the wholesale price to the Australian consumer,” Frydenberg said.

NRMA spokesperson Peter Khoury said the plunge was “certainly positive for motorists”.

“We think the next [price drop] in the capital cities will be about 10 cents a litre for regular unleaded,” he told The New Daily.