Petrol Prices...

Some of my loyal readers might prefer the term gasoline. However, in my part of the world it is known as petrol.

This is just a short musing on the fluctuating prices of petrol in Sydney. I recall hearing about how the price fluctuated but had paid little attention to it. After all, I was living in Jakarta and not driving so it really did not make that much difference to me. Now that I have returned to Sydney and drive every now and then I tend to notice these things more.

The price over a seven day period fluctuates between 108.9 cents a litre to around 126.9 cents a litre. Now, what is interesting about this is that it does not seem to be based on any movement in crude oil prices, but rather what day of the week it is.

Tuesday is the cheapest day and Friday tends to be the most expensive day. It also helps that on Tuesday I get a discount of 4 cents a litre because I have a Woolworths loyal shopper card.

I wonder why such huge fluctuations that are not based on changes in the crude oil price are acceptable? Surely there must be a breach somewhere of some code...then again, I guess not as the practice continues.

Rising Fuel Prices

A recent study by the CSIRO in Australia, Fuel For Thought, suggests that fuel (petrol) could reach AUD 8 per litre within ten years. This is expected to add about AUD 220 per week to the expenses of anyone running a medium sized car by 2018. This rapid rise is premised on an ever-decreasing supply in a time of ever-increasing demand. Simple economics really.

It would therefore make sense that now is a good time for investment in cars that are more fuel efficient and perhaps even into alternative fuels. It is much more than just reducing our carbon footprints and saving the world from a self-induced inferno. There is a genuine need for us to innovate with respect to energy in order to survive.

Once we have burned all our fossil fuel supplies and we have drilled every where there is to extract each and every last drop of the black gold, then what? Then what will be our chance to see Darwinian theory up close and personal, as only the fittest will survive!

Perhaps the report is not all gloom and doom, but it certainly does not paint a rosey picture of the future. There are a lot of assumptions and theorizing in the report that seems to require certain things to happen and certain times and quite often simultaneously in order to make the numbers work.

In a move to alternative fuels such as ethanol from maize there are inherent problems. One such problem has already come to the fore. More people are planting maize and selling it to fuel producers because they get a better price for it. This means that there is less maize in the market place and there will ultimately be food shortages which in turn drive up the cost of foodstuffs generally. Pressure from another angle.

These pressures will increase as the world reaches the peak oil limit. Peak oil simply is where production rises to a peak and then begins to decrease as no new reserves come on line or are discovered.

What is clear is that we should expect an increase in the price of petrol at the pump.

The report deals with the impacts in Australia. I might have to write a post on how peak oil might play out in the very inefficient Indonesian setting. It is scary just to think about as oil is still heavily subsidized here. The photo was taken from here.

Fuel Prices At The Pump

The Indonesian government's recent decision to jack up the fuel prices here in Indonesia was met with some isolated but fierce demonstrations. Isolated because many of them were one off and have yet to be repeated. This tends to give the impression that in most cases the demonstrators were of the rent-a-crowd variety.

Nevertheless, the reduction of the fuel subsidies is going to have a significant impact on the great number of Indonesians living on or under the poverty line. Estimates put this figure at somewhere near 40 million people. The jacking up of the fuel prices is going to impact on the middle and upper classes as there is likely to be fuel-based inflation in prices of most goods. Yet, the impact will be minor compared to others.

In any event this got me to thinking. Australians, at least Sydney-siders, are now paying record prices for fuel at the pump. The price last night in Sydney has reached 171.9 cents a litre. When I left my homeland the price of fuel at the pump was under AUD 1. How times have changed!

The thinking part comes on this point though. Indonesians are now paying around IDR 6,000 a litre for fuel. Considering they were paying IDR 2,500 a couple of years ago this is a significant hike. Nevertheless, if the 171.9 cents per litre is converted to IDR, then Australians are paying the equivalent of about IDR 16,000 per litre. Indonesians have still got it good in that sense.

The Difference Between Peace and War

The difference between war and peace is a mere tank of fuel!

Is this an accurate reflection of the Bush debacle that is the war in Iraq?

I report, You decide! (sounds a little Fox Networky, doesn't it?)