Petrol tops consumer worry list By Matt Wade
September 14, 2005 The price of petrol has forced its way to the top of the list of consumer worries amid warnings that fuel costs have passed a critical economic "stress point".
Soaring petrol prices were rated the highest consumer concern, replacing terrorism, the health system and the environment, a Sensis consumer report found.
Motorists may get some relief at the bowser in the next fortnight. The international price of oil fell $US63.19 on Monday night, compared with the record of above $US70 early last week.
But the Sensis poll of 1500 people found respondents expected to spend even more on transport in the next 12 months.
"Australians now believe high petrol prices aren't just a short-term fluctuation," said the report's author, Christena Singh.
"We will have to wait and see whether this translates into lower levels of consumer confidence and spending behaviour."
The Sensis survey found households with incomes below $35,000 were most likely to report concern over the price of petrol.
The Commonwealth Bank said its petrol stress indicator showed petrol prices had moved well above the "critical value" that would cause economic stress.
Oil drives confidence to rough ground By Josh Gordon
Economics Correspondent, Canberra September 14, 2005 TREASURER Peter Costello has warned that soaring petrol prices will do "no good at all" for the economy as worried consumers pare back spending to repair battered finances.
As the world oil price yesterday edged lower on easing supply concerns, a new survey showed that the high cost of petrol is the No.1 worry for consumers — more significant than concerns about terrorism, the environment or health.
The Sensis consumer report for September says that although the terrorist attacks on London raised concerns about the terrorism threat to Australia, that threat is a long way short of fears about petrol prices.
"The cost of petrol went right to the top of consumers' concerns," report author Christena Sing said. "Unfortunately, Australians are not expecting their concerns about petrol prices to ease in the near future."
Mr Costello warned that high fuel prices would have extensive ramifications for the economy, adding to price pressures, hitting family budgets, and increasing energy and transport costs for retailers and producers.
"Mark my words, it does no good for the Australian economy," he said. "It doesn't help business, it doesn't help the economy, it doesn't help consumers, it doesn't help the consumer price index, it doesn't help other retailers who get squeezed because more of a family's budget goes on petrol."
Families are paying about $50 extra on monthly fuel bills compared with the start of the year.
A report released by Virgin Money estimates that almost 600,000 people switched from being spenders to savers between December 2004 and June 2005.
Virgin Money director Carole Donaghy said the report, based on a Nielsen poll of more than 12,000 people, raised the possibility of a "nasty end" to the recent consumption boom.
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