#105 - Higher Petrol Prices Quietly Raise The Price Of Everything

Fuel prices don’t just change what you pay at the pump. They quietly rewrite the price of almost everything you touch: groceries, building materials, deliveries, flights, and even that “quick” Uber ride that suddenly comes with a surcharge. We zoom out from the headlines and talk through why petrol and diesel increases can hit Australia hard, especially when global conflict and uncertainty keep energy markets on edge.

We break down the biggest ripple paths in plain English: freight and logistics costs that push supplier pricing higher, farming expenses tied to diesel-powered machinery and petroleum-based inputs, and construction costs driven by heavy equipment, material transport, and worker travel. We also connect the dots to the property market by explaining how higher build costs can affect feasibility, margins, and what buyers end up paying. If you’ve been wondering why everyday spending feels tighter even when you haven’t changed your habits, this is the chain reaction.

We also touch mining and resources, where remote operations burn huge amounts of fuel and higher extraction costs can lead to tougher business decisions, plus aviation and tourism, where airfares can move fast when fuel spikes. The takeaway is simple: you can’t control oil prices, but you can control your plan. Subscribe, share this with someone who’s feeling the squeeze, and leave a review with the one cost increase you’ve noticed most lately.

Transcript

Fuel Prices Hit More Than Cars

SPEAKER_00 0:00

Fuel prices are going up and they contribute to a lot more than just filling up your car. We've got to think of it from a perspective of what impact does it have on other goods and suppliers? For example, farmers, they have to pay for tractors, which they pay for fuel. Construction, trades need costs, concrete needs costs, all of it uses fuel and diesel. You've got running costs of other things. So today we're going to break down more on fuel prices and what impact they could potentially have. Welcome back to another episode of the Finance Bible Podcast.

Oscar Don 0:36

Zeke here. And your co-host Oscar. But before we get into it, please note that nothing in this podcast should ever be considered as personal financial advice.

SPEAKER_00 0:44

Although, if financial advice is what you are seeking, let us know. We can get you in touch with the correct team.

Why The World Feels Pricier

Oscar Don 0:50

But for now, sit back, relax, and enjoy the show. Let's get into it. Now welcome back to another episode, as you heard, on the trailer, talking about the fuel prices and the impact that it has, not just your own bank account, but everything with the country right now. Different industries, different individuals, different situations. And one we didn't mention in the trailer is I actually was a victim of this, Uber. You don't really think about it, but Uber at the moment has a surcharge of roughly 15 to 20% more on top of what you're spending because of the uh increased fuel prices. Makes complete sense. But something which generally would cost 20 bucks, well, good luck. Now you've got to put it in your budget for a little bit more money. But basically, what's happening in the world today is the war, Iran, America, Israel. That's all the headlines. If you've been living under a rock, just Google it. You can look at the whole thing from start to start to not even finish to where we are now because it's not ended. But fuel, it's impacted not just Australia but worldwide. And it's, you know, does it impact the building, building prices for individuals who are wanting to invest? Definitely impacts our bank accounts. But what other ways is it impacting the country? And that's kind of what we're going to deep dive on today.

Transport And Freight Cost Shock

SPEAKER_00 2:08

So when we're looking at it, we need to think about okay, what industries use fuel and why and what's going to be impacted? And today we're just going to have a super quick, easy episode. We don't need to go too into detail. It's common sense, really. So, first of all, Oscar's already jumped straight on it. You've got transport, logistics, Uber, rideshare, all of that kind of stuff. When you've got freight companies, so any product essentially that comes from anywhere in the world outside of Australia, that are having to get their product here, they're paying for fuel to carry that product everywhere. You've got logistics, freight, delivery services, like as simple as even Australia Post and that. They have to pay. And then if it's coming in on, say, a boat or an airline, then they have to pay, and so on. Fuel normally is like 20 to 50 cents of their operating cost on these big like travel companies or courier companies, I should say. Their prices are going to go up, which then means that the supplier of the product is going to have to increase prices as well, because they're then paying for all of that stuff too. So at the end, everything's going to trickle down the consumer in that circumstance, and it's going to have a pretty hefty impact. The next one along.

Farming Runs On Diesel

Oscar Don 3:13

We're talking about farmers. So why are they heavily impacted? You've got machinery. So if you're a farmer, you've got to obviously pay for your tractors, your harvesters, they run on diesel, and they're not cheap. Like you're filling them up pretty, you know, intensely as well for the long run. Then you've got you know irrigation and generators, they're often fuel powered as well. Fertilizer and chemicals, you know, derived from petrol. So again, that's where the fuel comes into play as well. So these farmers, and a lot of farmers have it tough as well with droughts and everything like that in the past. Um, you've seen many droughts, and farmers are struggling to make make some coin. But when this happens, when you have your whole company or your home or your farm purely based on needing machines to move to get things going, you need petrol, diesel to get you going. So that's gonna really affect anyone who is, you know, on a on a farm, a farmer, construction, anything like that, who needs their machines to actually move and groove.

Construction Costs And Property Flow-Ons

SPEAKER_00 4:13

Exactly. And there's gonna be a lot more mentioned that we uh a lot more than we do mention, I should say. But we're just gonna go through a couple, provide a big picture, and then you can sort of sit back and go, okay, what's this gonna impact in my life? Should I prepare for that? Do I need to increase my budget? And so on. The next one being construction and trades. So you've got heavy machinery, you know, excavators, cranes, bobcats, dump trucks, and all of that kind of stuff. So land development, building, even renovations, concreting, all of that is gonna end up going up. You've then got the transport of materials, so all of your steel, concrete, timber, it's got to get transported, delivered on site, and often imported as well. And then workers commuting to job sites, so the actual travel of the worker. So you're gonna have an increased project cost, possibly delays or reduced margins for the actual builder. So if you're in a fixed price contract, or if you're looking at signing a fixed price contract, I'd probably suggest getting that done sooner rather than later. However, if you're entering one that there's potential for variations for things that are out of the builder's control, there's a fair chance that a variation may be passed on to you in this circumstance. And then that's gonna have a flow onto property prices and development feasibility, land prices, because as the um prices for all of it go up in terms of producing the product, it's gonna obviously onflow to consumers during the sale of the product. So the property market will increase even further.

Retail Prices And Everyday Spending

Oscar Don 5:32

And with that as well, if you're wanting to get into the property market, that's kind of where we come into it and look for areas where, you know, obviously prices are increasing quite dramatically right now with A, just the property locations, but B obviously what's going on right now in the world. So we want to figure out where is an affordable area that's going to grow over time. So for individuals getting priced out, which majority of the population is about to, with construction costs, etc. going up, you know, where is the more affordable region that you can kind of jump into it and get the same benefits, but without spending, you know, 10 times the amount. And then we've got another category, uh, retail and consumer goods. So, you know, why are they getting impacted? Well, you've got the higher freight costs from suppliers, you've got warehousing and distribution costs as well increasing over time. So purely with that, you've got the results of groceries increasing, you've got your electronics increasing, like if you go to JB Hi-Fi, for example, um, and as well as clothing. It's pretty simple how that all works. Gets impacted on that their end, and then we get impacted on our end when we're trying to actually purchase the goods for ourselves. So that's definitely going to increase. It's increased a little bit right now, but over the next couple months, when this war continues as well, we're going to see quite a steep increase in in that realm as well, I do believe.

SPEAKER_00 6:51

And then a huge one that's going to have a flow on effect to literally absolutely everything is mining and resources. So you've got remote operations, you've got heavy usage of fuel and machinery, and then they're using extreme amounts of diesel. So if you've got an increased extraction cost per ton and their profit's going to drop, then either A, they're going to need to increase prices. And if they're locked into contracts with companies that are buying their coal or whatever their resource is for a certain amount of money per ton, then they're going to be like, all right, well, how do we cut costs? So it may result in people being put off, it may result in no overtime, it may result in many, many different things, or passing it on to the consumer at the other end if they can renegotiate their contract and uh pull a clause in there. But ultimately, there's a whole bunch of different things that are going to be done. Like you've got manufacturing, which is common sense, aviation, tourism. Can confirm, I'm getting on a flight in an hour and a half, and it was not as cheap as it normally is. I was trying to book a flight to Japan in a couple of days, and my flight, actually, when I was looking at the prices, I got a notification. It went from$1,400. This is one way, by the way, to$5,400 in like three days. And I was like, hmm, interesting. Insane, isn't it? Yeah, it's a bit of a heavy.

Oscar Don 8:03

I do remember your face dropping when you told me that.

SPEAKER_00 8:05

Yeah, a bit of a hefty uh price to pay that one. And then you've got public transport, government services, you've got packaging for plastics and chemicals and all of that, because you the oil is like the raw material, it's not just fuel.

Oscar Don 8:16

Yeah.

SPEAKER_00 8:17

And I mean the list goes on. There's more and more, but I reckon that's a pretty common sense kind of approach where you can sit there and go, okay, virtually everything is affected by oil and fuel and petrol.

Budget Reset And Final Takeaways

Oscar Don 8:28

Yeah, like when you go out for coffee or breakfast today or tomorrow, just think about what's going on. Like with your coffee, etc., your food. It's probably, you know, most of the most cafes are slightly increasing the cost. Look around, look at the petrol prices, go up every day. We're brecky yesterday, and the petrol prices jumped 10 cents within what 20 minutes. Yeah, we actually watched them do it. Yeah, it actually we switched on a live time. We saw it increase. So just have a look around because there's a lot more things around you than you think that are actually impacted by this. And unfortunately, for yourselves, we're the ones going to actually have to pay for it. Even though we didn't have any anything to do with what's going on, if you're from Australia, you're just an innocent bystander, you're the ones you know actually spending more money. So it's it's tough, but it is what it is. You just got to adapt.

Follow Share And Sign Off

SPEAKER_00 9:17

That's a good way to end it. Interest rates are going up, fuels going up. Never been more important time to get in charge of your finances. Sit down, review your budget, sort everything out, and look at what you can do to make sure if you're in this situation again in the future, you're not. So that's a great finishing touch. Cheers. Dale. Ciao. Well, that is the end of the episode. We hope you enjoyed it. And if you did, you know exactly what to do.

Oscar Don 9:41

Hit that follow button, like button, subscribe, share it to your friends, families, or even a coworker.

SPEAKER_00 9:47

If you're really feeling generous, you can send it off to an ex. But catch you next time. Hope you enjoyed it. Dale.

Oscar Don 9:53

Ciao.