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Economic Weather Report: Brace for higher petrol prices as tax increases bite
November 3rd, 2009Watch the You Tube video here.
Bernard Hickey delivers an economic weather report on why petrol prices may be about to rise as oil company margins are compressed because of higher taxes. The weaker New Zealand dollar and a firm oil price will also keep the pressure up on the petrol price.
Here is the full interactive chart showing the various components of the petrol price.
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November 3rd, 2009 at 8:32 pm
For this reason I believe stagflation will prevail.
November 3rd, 2009 at 10:06 pm
agree and this is the start of it. the housing bubble will burst and costs of basic living goods and commodity prices will be at an all time high, throw in increased unemployment and things do not look good. the question is when will be the tipping point – by the end of 2010, probably not as too soon but we will start to be feeling it; the end of 2011, more likely but the World Cup will stave it off to a degree so we will survive into 2012 but from mid-2012 things will deteriorate quite quickly; which leads me to predict that we are looking at implosion by the end of summer April / May 2013
November 3rd, 2009 at 10:22 pm
Bernard, I’m lost as to how you calculate your oil company margin.
November 4th, 2009 at 7:00 am
Looking from round the bend, it’s possible to spot a National govt in deep effluent as it approaches Nov 2011. By then Bollard will have raised the ocr to about 5% and the Kiwi will be down, meaning everything imported will be up and since we don’t make stuff anymore…there is set to be quite a bit of inflation arrivng. Throw in the rise in fixed rates as the banks go for survival plus bigger margins and let’s not forget all the taxes charges and other govt (and council)thefts will rise and rise. The exodus to Aus by the young and skilled will be a flood. Where oh where will the govt find the 20ooo rich migrants from…you know…the fools prepared to scoot off to Noddyland with all their dosh and save the bubble…not bloody likely. So property is set to resume its slide down the slope to the black hole at the bottom. Deflation in property. Inflation in all else. Wages going nowhere. Unemployment remaining high as. Don’t look good do it. Never mind…Bill’s got a ’strategy’ and there’s Don to be wheeled out for an airing soon. The TWgroup report will use up the poodle media space over the summer before being shelved as too much like a total change for the better.
November 4th, 2009 at 7:57 am
Wally
you have forgotten to add the collapse in our export prices as the liquidity created by the Fed races home, leaving us with a massive funding shortfalls and record low prices for Milk etc.
November 4th, 2009 at 8:34 am
Milk price up 88% since July so what’s with the record low theory AndrewJ
November 4th, 2009 at 8:51 am
No AJ, the Kiwi will slide on down and provide some export support along with the rise in commodity prices. Milk powder rise is an example. Still will not change the bleak picture. Invest in food copper iron ore water oil gas coal ….etc…these are the things that will see demand growth and Dollar adjusted rises. Property is set to fall as soon as the market drops a bomb on the Beehive roof. Nothing else will stop the fools from porking the banking rort going on. The public are too thick to know what a bubble is let alone realise they are inside one. It will be the rates on credit that will cause the implosion. Now……… who wants a knighthood?
November 4th, 2009 at 9:14 am
Isn’t strange how the mood of people changes, not so long ago people smiled and thought the economic party would never end. Now everywhere are glum faces and predictions of the end of their World. The truth is as always somewhere in the middle.
In a perverse way all the economic ills of the country may well be a good thing in the long term, but only provided the hard decisions that need to be made are in fact made and acted upon. This more than anything else is a political question, will the politicians do what is needed or simply put it off for the next sucker to deal with?
It is time to make the hard decisions, the first of which is to stop moaning and being negative, we all can say what is wrong, a habit that simply feeds on its self, what is needed is determination and energy to put things right.
November 4th, 2009 at 9:20 am
I think someone should look into the cost of LPG and automotive LPG at the pumps…
The difference between fleet card and retail, the petrol companies appear to milking profits of LPG…and would not be surprised the wholesalers are to.
Im not sure if there is the equivalent to petrol tax on automotive and bottle LPG, and believe the retail prices tend to be aligned with the “equivalent” L/km to petrol rather than a genuine LPG price…
There are a hell of a lot of fleet and taxi s on LPG..
And given the “clean Green” benefits of LPG why is LPG not encouraged in its pricing.
And there are now a lot of models, off the production line using LPG.
We did used to have LPG priced locally, till supply required importation, and retail was tied to international market price…but the numbers in this argument just dont add up
Automotive pump prices are up in the $1:30 mark
Fleet card base price $1:0058
Pump price in Perth and around Aussie, Canada 0:45 to 0:55c (currency conversion not included in these numbers) even so numbers just dont add up.
And bottled prices are way above these numbers in NZ.
BH you did a good job on Cafter…heres another one.
Video link doesnt open in new window or tag..pain in the butt…better still should open in same window as it used to…
November 4th, 2009 at 9:46 am
I agree with Miguel, where do these margin figures come from?
November 4th, 2009 at 10:32 am
Figures come from oil companies
November 4th, 2009 at 12:23 pm
They’re supposed to be sourced from the MED. All of the other series are fine, but I can’t see anything on their website that even vaguely resembles the oil company margin that Bernard is using.
November 4th, 2009 at 1:04 pm
So when it comes to oil Mr Hickey thinks higher taxation leads to higher prices, but when it comes to housing Mr Hickey thinks higher taxation will lead to reduced prices?