Friday, September 30, 2016

Gas Prices to Rise in Australia: Here’s Why

Gas Prices to Rise in Australia: Here’s Why

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Australian Competition and Consumer Commission’s chairman Rod Sims is expected to issue a warning against the rise in gas prices very soon.

On Thursday, Sims might address Australians on Thursday regarding the hike in the fuel price after Victoria imposed a ban on exploring for gas onshore. This will, however, strengthen the hold of the gas owners in the Bass Strait and thereby make negotiating on their selling price difficult.

According to Lateline alert published earlier in September, the gas industry across Northern Territory would soon witness a considerable rise in the gas prices, which ultimately will lead to misbalance of demand and supply for the fuel. Where Victoria already banned coal seam gas exploration and extraction, rest of Australia also seem to follow the same.

While the new Labor Government has suspension of the gas exploration as its election campaign agenda, Western Australia appears to follow a vice-versa technique. It is being speculated that in the early elections in 2017, this issue might change the entire political scenario in NT.

The fracking decision has come as a joyous verdict for farmers and environmental campaigners in Victoria. For them, the decision will turn out to be a blessing for the agriculture sector. On the other hand, the resources industry has raised concern over the resulting hike in the gas prices following the decision.

Fairfax Media obtained a copy of a speech from Sims where he referred to the recent ban on exploring for unconventional gas put by the Victorian government. “Without this supply, it is clear that gas prices must increase, which will damage [commercial and industrial] users and increase household energy bills … It is difficult … to envisage where new gas supply will come from in the short to medium term to alleviate the high prices looming for gas users in the south,” Sims said as quoted by Sydney Morning Herald.