For many grey nomads who carefully budgeted out the cost of their ongoing adventures based on prices at the time they hit the road, it’s time to rip up those calculations and start again.
The cost of filling up the fuel tank has been soaring, and the experts fear it might continue to do so for a while.
Other than wincing every time they pull up at the bower, long-term travellers also have to decide how they react to the new reality. Basically, it comes down to busting the budget and travelling on as planned, reducing the number of kilometres travelled each week, or cutting expenses elsewhere … perhaps on van park fees or on tours.
So, what’s going on? And when, of ever, will things get back to ‘normal’?
Well, crude oil has just hit a seven-year high. Oil prices have risen for eight successive weeks on market expectations that crude demand would outpace supply as the global economy rebounds from Covid disruptions.
Commonwealth Securities senior economist Ryan Felsman said escalating tensions between Ukraine and Russia were also driving up prices.
“Rising geo-political tensions in Eastern Europe could be the major catalyst needed to justify crude oil’s potential move above US$100 a barrel,” Mr Felsman said.
The situation in Australia has been made worse by the fact that the Australian dollar is relatively week.
The ABC says that, back in September 2014, when oil was last close to $US100 a barrel, the Australian dollar was around 90 US cents. Now, the key Brent crude futures price is $US95.64 a barrel, but the Australian dollar is only worth around 71 US cents.
The Australian Institute of Petroleum said that the national average retail unleaded petrol price had risen by by 5.1¢ in the past week to a fresh record high of 176.9¢ a litre.
The institute said the petrol price hit record highs of 181.8¢ a litre in Perth, 182.3¢ in Melbourne, 185.2¢ in Hobart and 177.3¢ in Canberra.
On Monday, the highest price in Perth for unleaded petrol was 195.9¢ and the lowest was 160.7¢.
“Filling up the car with petrol is one of the single biggest weekly purchases for consumers, with inflation and cost of living pressures a focal point in recent consumer sentiment surveys,” Mr Felsman said. “Assuming the purchase of 35 litres of petrol per week, Aussie households are currently spending $247.66 a month on petrol.”
100 litres diesel $180.00. Budget blown. Going to have to sit.
It’s terrible, what we had budgeted for has blown out. Hasn’t stopped us at this stage, just being frugal elsewhere. Not sure how the vans travelling at 110kph do it, must be loaded $$$$$
Could be time to downsize to a smaller caravan & tug.
Diesel $1.92 a litre in Ulverstone Tas.