Wednesday January 18, 04:46 PM AAP
Petrol prices tipped to increase
Australian motorists can expect higher petrol prices because of an international
dispute over Iran's nuclear program, analysts say.
US crude oil prices rose above $US66 a barrel to a three-and-a-half month high on Tuesday - just $US5 lower than the price of $US71 a barrel after Hurricane Katrina last year.
The
United States and European Union want the UN Security Council to consider action against Iran to prevent, or punish, that country for moving forward with a uranium enrichment program that the West fears could lead the development of a nuclear bomb.
That action could include an oil embargo against Iran, the world's fourth biggest oil exporter.
Iran says its uranium program is intended to create fuel to run nuclear power plants and boost electricity supplies.
Commonwealth Bank commodity analyst Tobin Gorey said any disruption in Iran's crude oil exports would further tighten the global oil market and lead to higher petrol prices.
"Oil prices are already higher to reflect the risk it (an oil embargo) might happen," he said.
Mr Gorey said Iran produced five per cent of the global output of crude oil.
"It may not seem like much but if you take Iran out of an already tight market it would have an effect," he said.
"Oil is a global commodity and if all of a sudden there is less in the pot, so to speak, then the price will go up."
"There is already strong demand (for crude oil) and there is no room for disruptions to production."
Mr Gorey said motorists should start to see higher prices for petrol at the pump now.
Royal Automobile Club of Victoria (RACV) spokesman Michael Case said petrol prices were always vulnerable to world events.
"Any threat to the supply of crude oil would have a corresponding effect at the pump," Mr Case said.
"I'm not sure how much prices could rise, that would be hard to predict."