Caltex’s magazine for employees, franchisees & resellers
Issue 43 Jun – Jul 08
How Asia drives Australia's fuels destiny
A Beijing street choked with cars, an inevitable result of Asia's rapidly growing demand for transport fuels
Asia driving our fuels destiny
Everyone who uses vehicles and machinery laments the rising cost of fuel. Many blame the oil companies or the government, the most visible identities of their hip-pocket pain.
Postcard from India
The number of cars on the road in Mumbai, Delhi and other cities is staggering. To go from the office to the airport here might take two and a half to three hours. As a result, there’s a huge and growing demand for petrol and diesel in India.
Postcard from China
When I grew up, among the apartment blocks and alleyways where I lived every Chinese rode a bicycle. These days the space bicycles take up on the roads is small. On the other hand the number of cars on the roads is extraordinary.
The ebbs and flows of the AGM
It’s five minutes to ten on Thursday, 24 April. Around 250 people are filing into the auditorium of the Wesley Conference Centre in Pitt Street, Sydney for an important event on the Caltex calendar, the company’s annual general meeting.
What's happening to our service stations
Bill Dircks remembers when the main aim in fuel retailing was to get a petrol pump on every corner and service station sales rooms had an office desk and displayed a few fan belts and batteries.
From the Managing Director
As the rapid rise in oil prices has a deeper impact on the lives of people across the world it is clear there can be no quick fix. Today’s record fuel prices are a signal of how much things have changed.
Australian motorists’ anxiety about local petrol prices might at first seem far removed from current social, economic and industrial developments in China and India. But as we discuss in this issue of The Star, today’s global economy means these issues are now directly linked.
The surge in demand in Asia’s two largest economies is not going to ease soon, and with crude oil at over US$130 a barrel – almost double the prices of early last year – it’s clear the age of cheap oil is over.
The current boom in India and China presents a challenge on both the demand and supply sides of the equation. While these countries’ rapidly expanding demand for fuels is increasing regional prices, India’s new low-cost export refineries also have the potential in future to put competitive pressure on Australian refiners which operate in a higher cost environment.
Caltex Chairman Elizabeth Bryan acknowledged the challenge for our company in her address to shareholders at our annual general meeting in April. She said that oil refining and marketing is a very high volume, very low margin business and that we operate in a very competitive market. She pointed out that Caltex is not a producer of crude oil, our main input, and has to pay world prices for it on the open market – putting a lot of pressure on our working capital requirements.
The Australian community, government and industry must work together to ensure the country has a reliable and secure petroleum fuel supply. This will mean the policy debate needs to focus on how Australians can best adjust to the emerging era of higher petroleum and energy costs generally.
Des King