Petrol and kerosene retail and wholesale prices have increased significantly for October to November, starting on October 16.

The Competent Authority said overall this month all product prices would increase significantly.

The wholesale price for petrol increased by 9.46 seniti/litre to 278.17, 8.30 seniti/litre to 205.93 for kerosene and 9.75 seniti/litre increase for diesel to 285.90.

Tongatapu retail prices for petrol, kerosene and diesel are 294.27 seniti/litre, 218.93 seniti/litre and 302.00 seniti/litre respectively. All price changes include consumption tax.

The Competent Authority stated that crude prices (Dated Brent) reached a four-year high at USD83.64/bbl on September 28, supported by the tightening of supplies from US sanctions on Iran and production disruptions in Libya and Venezuela.

Global oil demand is high, and this may ease as some countries look to reduce imports in order to offset the impact of rising prices (due both to higher prices and the strengthening US dollar). OPEC has increased production to compensate for the loss of Iranian crude and other OPEC members production disruption, although global supplies remain tight supporting crude oil prices.

While crude prices rose, product prices rose less than crude resulting in reduced refining margins for all products. Diesel prices were supported by refinery maintenance in Japan after the earthquake disrupted exports, allowing refiners to push up prices. Comparing the September 2018 month average prices with August.

In addition, the Pa’anga has continued to weaken against the US dollar and combined with higher international prices resulted in a spike in local prices.