Average Perth fuel price drops to $2 mark for first time since September 1 amid subdued Iran war conflict

Perth motorists are in for a slight reprieve with the average average unleaded fuel price falling to $2 a litre on Monday as a pause in the war in Iran helps to cut oil and lift market confidence.

A 1.7c a litre drop in the average price will see unleaded fuel at $2 or below for the first time since September 1, when motorists forked out a little over 196c a litre.

Drivers in the city will be able to get their fuel for as cheap as 187.2c a litre from Vibe Oakford Truckstop, while Burke Oakford will have it for 187.3c and Vibe Ascot will offer unleaded for 188.5c a litre.

A total of 16 sites are set to have fuel at under 190c a litre, while well over 50 service stations will offer fuel below the $2 a litre mark.

Unleaded fuel has been on a downward trend in the city for the past month, with prices having dropped by about 25c a litre in the last two weeks and more than 40c in a little more than a month.

Petrol had reached the eye-watering heights of 245c in mid-October.

The cost of diesel will also come down slightly to 254.9c a litre, a modest reduction of 0.3c.

Premium 95 unleaded and 98 unleaded will both drop in price by more than 1.5c a litre, to 216.1c and 224.8c respectively.

Unleaded users in Albany, Busselton and Geraldton will all enjoy a drop in prices ranging from 1.8c to 0.1c, while the other regional hubs have no change to their prices.

Economist Conrad Liveris said the drop in prices were down to a stabilisation of conflict in Iran.

“The main reason why petrol prices are going down is due to the market, there’s a bit more stability in the market at the moment,” he said.

“Prices are stabilising and that’s because the war is in a less intense moment right now, while there’s still instability over there.

“We’re not in the same market that we were say a year ago, but we’re in a more predictable market, and so the price is being able to go down.”

Mr Liveris warned the reprieve could be short-lived if the war flares up again.

“We won’t get to a point where they will fall much longer, they’ll coalesce and stabilise around a particular price,” he said.

“What we’re at at the moment might be a little bit elevated, they might drop a little bit more, but not too much more.

“If there is an escalation in the war, it depends on the intensity of it, so it could become even more expensive than what we knew.

“It depends on how intense that escalation is and how long it goes for, those are the things that were driving the elevated price in oil.”

While the risk remains, Mr Liveris said WA and Australia remains in a good spot with its fuel reserves.

“We now have above 40 days worth of oil ready to go, as long as that doesn’t drop for either the country or the State, then prices will be reasonably stable,” he said.

“The problem is that the oil price itself changes so dramatically based on global events, so there are limitations in what can be done.

“The best thing that governments can do is make sure that supply is maintained.”