Political upheaval in Libya could trigger a rise in the cost of petrol as early as next week, after brent crude oil prices climbed to their highest point in two-and-a-half years overnight.
Concern is mounting that the turmoil in Libya could threaten crude supplies out of the oil rich nation
as a wave of protests that have swept across the Middle East, hit Libya.
The cost of Brent crude soared by 2.5 per cent to its highest level in two and a half years, and there are suggestions that continued upward pressure on oil prices could have a knock-on effect for motorists here.
ASB chief economist Nick Tuffley said oil companies tended to set their pump pricing in response to changes to the exchange rate and spot oil prices, and any impact could be felt here in a week.
"The issue is really how long oil prices stay at higher levels. The longer they stay at higher levels the more chance we see a bit of flow through to our pump prices here," he said.
AA PetrolWatch spokesperson Mark Stockdale said the cost of petrol would continue to rise as the world climbed out of a recession and demand for oil increased.
"The reality for motorists is even without the Middle East crisis ...prices are predicted to rise," he said.
The extent of those rises would be in part determined by global events such as the situation in Libya, he said.
Petrol prices hit their highest level in more than two years last week, with the cost of 91 octane petrol rising 3c to $2.02, and 95 octane reaching $2.11 per litre.
Based on current trends motorists could be paying $2.20c per litre by the end of the year, Stockdale said.
Meanwhile the impact on New Zealand exports to Libya was unclear today.
Figures show $51m worth of products, including $49.7 million of dairy products, were exported to Libya in 2010 from a total $43.5 billion worth of exports out of New Zealand last year.
Fonterra indicated that it was probably too early to say what impact the unrest may have on its exports to Libya.
- NZ HERALD ONLINE
