00:02We've already seen those spikes in world wholesale fuel prices with Brent crude jumping by almost
00:089%, the highest it's been in months, and motoring groups are warning that we could
00:14see the impact of that within a week at the petrol pump.
00:18Now it's normally the case that we see some of those world shocks flowing through to the
00:24bowser within about seven to ten days, but at the moment we're already seeing some of
00:30those price increases, for example here behind me the cost of unleaded is already well north
00:35of $2 a litre, in some places south of Brisbane it's even nudging up towards $2.20, but the
00:42NRMA is urging motorists not to panic and they're also warning oil companies not to be opportunistic
00:49and use this as an excuse to jack up prices early.
00:53And as you mentioned as well, one of the key things we're really keeping an eye on is the
00:58supplies of global fuel.
01:01Now as you mentioned, we've got the Strait of Hormuz, which accounts for about 20% of
01:07all of the world's oil supplies that actually pass through that strait in the Middle East.
01:11That is virtually deadlocked at the moment, so we don't see those supplies getting out.
01:17And that prompted a question in Parliament yesterday of the Energy Minister Chris Bowen.
01:20He was asked exactly where Australia stood when it comes to its energy reserves and he
01:26revealed that we have just 34 days of diesel fuel left in reserve and 36 days of petrol.
01:33However, he did stress that this is the highest level it has been in 15 years.
01:39Steph, what are the wider implications of this?
01:42Well, it's not obviously just that spike in fuel prices that everybody has to account
01:46for when it comes to your household budget.
01:48It's also of course the flow on effect that increased fuel prices have because they are
01:54after all an input cost into so many other products.
01:56If you think about your food and veggies and fruit that comes into the supermarket, it
02:00has to get there somewhere and that's normally on diesel trucks.
02:03So that will inevitably end up meaning that you're looking at higher prices across the board for
02:09many of those products and that of course then bleeds into inflation and that is something
02:14that the Reserve Bank Board is really carefully keeping an eye on.
02:18Of course inflation is already sitting above its target band of 2% to 3% and it is something
02:24that it's really going to be deliberating when it meets next in the next couple of weeks.
02:29And that of course is to determine what happens with interest rates and whether or not any inflationary
02:34pressure caused by this could actually end up causing households even more grief when
02:39it comes to lifting mortgage rates as well.
02:42But of course also on the flip side, the Reserve Bank Board is also going to be looking at this
02:47global uncertainty and volatility and what sort of impacts that's going to have on economic
02:53growth and also consumer confidence as well.
02:56So that is also something that will factor into its decision making, particularly if this conflict
03:02is prolonged for a period of time.
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