A perfect storm of factors including falling supply and increasing demand in developing countries could see petrol prices rise to $8 per litre within a decade, according to a new CSIRO forecast.
A perfect storm of factors including falling supply and increasing demand in developing countries could see petrol prices rise to $8 per litre within a decade, according to a new CSIRO forecast.
The ultra-high price is the worst-case outcome among several different scenarios considered by an industry and community forum on fuel convened by the nation’s leading scientific think-tank.
It is based on the peak oil theory – that we are about to see a peak in oil production followed by a rapid decline. It also assumes alternative fuel technologies are slow to develop.
Other predictions see fuel prices increasing at more modest levels, with a slower decline in oil stocks and improved technology likely to result in prices closer to $2 per litre.
But it is possible and, according to the director of CSIRO’s Energy Transformed program, John Wright, could provide the basis for a shift in energy policy.
“Results such as this could be seen as a catalyst for early action on the development and roll-out of alternative fuel options, low emission vehicle technologies and infrastructure that supports sustainable transport,” Wright says.
In the near term, this could mean the increased use of lower emission or more efficient fuel sources such diesel, LPG and hybrid electric.
But even if the fuel perfect storm does not come about, modelling conducted for the forum identified one factor that is sure to mean retail fuel prices will be at least a little higher – an emission trading scheme.
“Prices are expected to be only moderately impacted – an increase of around 10 cents per litre at a price of $40 per tonne of carbon dioxide,” Wright says. “Even with this relatively small impact, our modelling indicates a steady shift towards low emission fuels and vehicles.”
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