Why are fuel prices so high?

On Friday, the price of a barrel of oil reached a record price of over $US75.00 - for crude oil to be delivered to the refineries in June. Latest predictions are above $1.50/litre.

The typical six cylinder family car consumes about 11 litres / 100km. That's the typical round trip for many rural residents visiting Wangaratta. That's now $16.50 to buy the groceries or $82.50/week to commute to work in Benalla or Wangaratta!

At what price will it affect your driving habits?

There are two theories being promoted about the high cost of fuel. First we have the troubles of the world we live in with Iraq, Iran, the effects of hurricanes and a myriad of man made and natural disasters. Second we have the oil depletion theory otherwise known as "Peak oil".

You can read about both theories here. No matter which you prefer to believe, the problen is definately not short term. High fuel prices are here to stay and we have to learn to live with them.





Oil breaks through record $75
Continued fears over Iran and Nigerian supplies, reports of gasoline shortage in the U.S. lead to 2 percent jump.
By Steve Hargreaves, CNNMoney.com staff writer
April 21, 2006: 4:26 PM EDT
NEW YORK (CNNMoney.com) - Oil smashed through record highs Friday, cruising past $75 a barrel on continued fears of a supply disruptions in Iran and Nigeria and reports of spot gas shortages on the U.S. East Coast.

U.S. oil for June delivery set a new trading high of $75.35 before easing to settle up $1.48 at 75.17 a barrel on the New York Mercantile Exchange, also a new closing record. The May contract expired Thursday at $71.95.

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Easy does it with petrol prices
By Gwynne Dyer April 21, 2006
Welcome to the world of $US70-a-barrel oil. That's if there is no crisis in the Gulf over Iran's nuclear ambitions. If there is, then get ready for $U140 a barrel. Oil briefly breached the $US70 barrier eight months ago, but this time it is going up for good.

Oil shock: what's in store? ... By Richard Webb - Sunday Age - April 23, 2006
Petrol to hit $1.45 a litre ... By Peter Weekes - Sunday Age - April 23, 2006

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Petrol prices tipped to soar
Last Update: Saturday, April 22, 2006. 3:44pm
Australian fuel prices are set to take another leap towards the $1.50 a litre mark, after the latest oil price record.

The price of oil on the New York market has for the first time reached $US75 a barrel, amid concerns about the dispute over Iran's nuclear program.

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