Petrol price drop on the way: Economy roundup

Falling oil prices on world markets should result in significantly lower petrol prices for Australian motorists in coming weeks.

Falling oil prices on world markets should result in significantly lower petrol prices for Australian motorists in coming weeks.

The price of a barrel of crude oil on US markets has fallen from highs of around $US147 a barrel to $US135 in recent days, and is forecast to drop even lower in the months ahead.

Once those oil prices filter through to Australian consumers – and assuming nothing happens to send prices higher – it should mean a 10c-a-litre cut in the price of petrol.

The rapid growth of China has been a key factor in rising oil prices, but new official data released yesterday suggests some of the heat may have left the Asian giant’s economy.

China’s GDP fell to 10.1% in the June 2008 quarter, down from 10.6% in the first three months of this year and 11.9% last year.

Weaker though it may be, China is still growing at a much faster pace than the rest of the world. According to the International Monetary Fund, the world economy is set to increase its pace of growth this year, but the 4.1% average still pales in comparison to the likes of China.

In Australia, booming commodity prices have helped produce an average 13.5% lift in export prices for the June quarter, compared to a rise of just 1.4% for imports.

On the markets today the S&P/ASX200 is down 0.7% on yesterday’s close to 4865.5 at 12.25pm, and the Australian dollar is also down to US97.16c.