8legs: Westpac

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Warning that petrol prices in Australian could hit $3 a litre

Westpac warns petrol prices in Australia could rise toward $3 a litre if oil supply disruptions persist in the Middle East.
A prolonged oil shock could lift Brent crude to around US$185 per barrel in a severe disruption scenario.
The modelling ties higher energy costs to broader inflation, potentially affecting groceries, airfares and mortgage rates.
Westpac based its analysis on the Oxford Economics Global Economic Model to test oil supply shock effects.
Reserve Bank of Australia officials warned inflation could rise if energy costs stay elevated.
The Strait of Hormuz remains a critical chokepoint, with significant portions of global oil trade at stake.
Oil market reactions could ripple into everyday prices through higher transport and energy costs.
If oil rises to $100 per barrel and remains there, interest rates may be 25 basis points higher longer term.
The report notes that energy costs can influence the overall inflation trajectory and policy responses.
Insurers have reportedly withdrawn cover for ships around the Hormuz region as a precaution.

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