{"id":721607,"date":"2026-07-31T20:58:33","date_gmt":"2026-07-31T20:58:33","guid":{"rendered":"https:\/\/www.newsbeep.com\/uk\/721607\/"},"modified":"2026-07-31T20:58:33","modified_gmt":"2026-07-31T20:58:33","slug":"from-uber-to-coles-companies-are-hiking-prices-during-the-oil-shock","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/uk\/721607\/","title":{"rendered":"From Uber to Coles, companies are hiking prices during the oil shock"},"content":{"rendered":"

\"An An illustration of a morning routine from people brushing their teeth, eating breakfast, driving to work and taking care of their children.(ABC News Graphics: Sharon Gordon)<\/p>\n

This century’s biggest oil shock is entering its sixth month, with no end in sight as war in Iran continues.<\/p>\n

So is this showing up in your daily budget? What could happen next? ABC News takes a look.<\/p>\n

At the start of the blockade of the Strait of Hormuz, the predictions about surging inflation were vast.<\/p>\n

There were even concerns about a 1970s style oil shock, where inflation soared and got baked into the economy despite falling employment.<\/p>\n

Here in Australia, milk was one of the first everyday grocery items to move upwards during the 2026 oil shock.<\/p>\n

\"An An illustration of two bottles of milk.(ABC News Graphics: Sharon Gordon)<\/p>\n

In April, Australia’s two biggest supermarkets both increased the price of home brand milk at identical rates of up to 12 per cent.<\/p>\n

Coles and Woolworths said they did this in response to a maelstrom of oil shock issues that started hitting supply chains in March.<\/p>\n

[\"Tea, An illustration of tea, milk and cereal.(ABC News Graphics: Sharon Gordon)<\/p>\n

Firstly, the obvious one: higher fuel prices.<\/p>\n

The pain at the pump didn’t just make it more expensive to freight milk, but it also impacted farmers through higher diesel prices.<\/p>\n

Dairy farmers were also facing higher fertiliser costs, which is another commodity caught up in the closure of the Strait of Hormuz.<\/p>\n

Then there was plastic. It’s derived from petrochemicals, meaning the oil shock even filtered through to making your milk bottle.<\/p>\n

The milk price surge is exactly the sort of broader impact economists are monitoring closely.<\/p>\n

“The oil price shock from the Middle East can seep through to the price of everything from food and travel to production and transport,” Oxford Economics’ Harry Murphy Cruise tells ABC News.<\/p>\n

“If firms pass those higher costs onto consumers, a temporary oil shock risks becoming a broader and more persistent inflation problem.”<\/p>\n

Four months later, despite fuel prices dropping down from the surge in March, the supermarkets have not dropped back milk prices.<\/p>\n

“Fuel, freight and other input costs across the dairy supply chain, including fertiliser and packaging, remain elevated,” Coles said in a statement.<\/p>\n

The latest inflation data shows this impact clearly.<\/p>\n

Since February, milk prices are up by 6.17 per cent, according to the Australian Bureau of Statistics (ABS) for the period up to June.<\/p>\n

“That’s directly related to higher farm gate prices,” Rabobank’s food inflation analyst Michael Harvey notes.<\/p>\n

So what else could get more expensive due to the oil shock?<\/p>\n

\"An An illustration of a person eating breakfast.(ABC News Graphics: Sharon Gordon)<\/p>\n

Your bread generally comes wrapped in plastic.<\/p>\n

So do lots of other breakfast staples, like bacon and cheese.<\/p>\n

Yet the inflation data shows more modest price increases on these products since February, with 1 per cent for bread and 2.2 per cent for cheese.<\/p>\n

Other items like eggs and breakfast cereal have actually fallen in price.<\/p>\n

Analysts say the shock on your shopping budget might still be looming.<\/p>\n

Milk and fresh produce prices are generally quicker to respond to market factors because farmers negotiate prices with supermarkets regularly.<\/p>\n

But manufacturers of packaged goods generally have longer-term pricing negotiations with grocery giants.<\/p>\n

And during tougher economic times like right now, brands and retailers might feel more pressure to absorb higher costs themselves.<\/p>\n

“[Companies are] sort of drip feeding higher costs through to consumers,” Rabobank’s Mr Harvey notes.<\/p>\n

“We’re just seeing the early stages.”<\/p>\n

It isn’t just food pricing that has been in the spotlight during the global oil shock.<\/p>\n

There have been headlines about looming price shocks on everything from lipstick to condoms.<\/p>\n

Many of these items are housed in plastic.<\/p>\n

\"Woman An illustration of a person brushing their teeth.(ABC News Graphics: Sharon Gordon)<\/p>\n

Toothpaste. Shampoo. Moisturiser.<\/p>\n

Currently, inflation data isn’t showing any price spikes on personal care products, with prices actually down by 0.7 per cent since February.<\/p>\n

Yet, one local company, Impact International, which makes squeeze containers has been passing on higher costs to its customers (popular grooming brands).<\/p>\n

How much they have passed on has ebbed and flowed during the oil shock, with pricing for resin fluctuating on global markets.<\/p>\n

“Who knows what the future holds,” Impact’s owner Aleks Lajovic tells ABC News.<\/p>\n

Manufacturers also say the global oil shock is impacting what goes inside some everyday items in your bathroom cabinet.<\/p>\n

What do moisturisers, hair masks, lip balms, even eyelash serum all have in common that’s linked to the oil shock?<\/p>\n

Petroleum jelly.<\/p>\n

\"An An illustration of a person putting on makeup.(ABC News Graphics: Sharon Gordon)<\/p>\n

A manufacturer for grooming brands says the cost of this oil-derived ingredient soared almost 18 per cent in the four months to April.<\/p>\n

New Direction’s Sebastien Jagut says they’re still experiencing price shocks.<\/p>\n

“While our team has worked hard to negotiate and mitigate some of these impacts, the overall inflationary pressure remains upward,” he says.<\/p>\n

And it’s not just what goes on your face.<\/p>\n

\"A An illustration of a man holding a baby.(ABC News Graphics: Sharon Gordon)<\/p>\n

Disposable nappies are obviously made from a lot of plastic, and you’d expect manufacturers of them are feeling the pressure.<\/p>\n

Yet Coles and Woolworths say home brand prices haven’t gone up in recent months, with Aldi even confirming a decline in price.<\/p>\n

UNSW economist Professor Richard Holden also believes businesses could be wearing higher costs for now.<\/p>\n

“What we’ve really seen with the conflict in the Middle East is a shock to energy prices,” he says.<\/p>\n

“Not only do they take a long time to flow through, they affect different parts of the economy differently.”<\/p>\n

Have you notice a price increase? Email our journalist at terzon.emilia@abc.net.au<\/a> or em.terzon@proton.me<\/a><\/p>\n

So what about what you wear every day?<\/p>\n

By now, you’d be getting the point that many things in your daily life are intimately linked to oil markets.<\/p>\n

Polyester is one of the most common fabrics used in modern-day garment manufacturing, and it is also derived from crude oil<\/a>.<\/p>\n

There is even a commodity benchmark that tracks the global price of polyester, listed on Chinese markets.<\/p>\n

\"An A woman, hair tied up in pony tail, large hoops in ears, beige tee, buttons her blue pants, looks down, skirts, jackets, pants, hanging on a clothes rail behind in a cloud.(ABC News Graphics: Sharon Gordon)<\/p>\n

Yet polyester pricing hasn’t been surging like the price of oil.<\/p>\n

“You can see it in the numbers this year,” Macquarie University oil expert and economist Lurion De Mello says.<\/p>\n

“Brent went from about US$62 a barrel in December to a peak near US$104 in May before falling back to the high 70s. Polyester staple futures moved a fraction of that.<\/p>\n

“Mills simply can’t push higher raw material costs onto textile buyers in a weak market.”<\/p>\n

As it stands, your fashion fix is officially 4.2 per cent less expensive since February this year, according to the ABS inflation data for garments.<\/p>\n

“The Australian and global economies today are very different from those of the 1970s,” the head of Australia’s central bank, Michele Bullock, told journalists this week.<\/p>\n

“This helps explain why the recent oil price shock has had a more limited impact on activity.”<\/p>\n

“First, the economy is less dependent on oil. This means a given increase in oil prices has a less direct and less pervasive effect on inflation today than it would have in the 1970s.”<\/p>\n

Now, this isn’t to say inflation isn’t a problem in 2026.<\/p>\n

As well as the oil shock, there are many global factors impacting supply chains, including the ongoing war in Russia\/Ukraine and climate change impacting crops.<\/p>\n

Analysts note this could add to price shocks created by the oil crisis, even making your daily coffee more expensive.<\/p>\n

\"Man An illustration of a person getting a coffee with their dog.(ABC News Graphics: Sharon Gordon)<\/p>\n

The RBA has a “liaison” of companies it talks to about what they’re doing with pricing.<\/p>\n

“More firms are looking to pass these costs on,” Ms Bullock noted this week.<\/p>\n

“While the effect on fuel prices and headline inflation has so far been smaller than initially feared, headline inflation remained well above target at 4 per cent in May.”<\/p>\n

Inflation is now officially at 3.8 per cent for the year to June, after a significant drop back down in fuel prices for motorists and major industries.<\/p>\n

Oxford Economics’ Harry Murphy Cruise says the June data “dampens” concerns about a broader inflationary shock from the oil crisis.<\/p>\n

“It’s better than expected given the oil price shock,” he adds.<\/p>\n

Yet this data is backwards looking, and we know that currently a different trend is happening.<\/p>\n

\"A Illustration of a person driving a car.(ABC News Graphics: Sharon Gordon)<\/p>\n

You have probably noticed the trip to the bowser is more expensive than it’s been in months.<\/p>\n

The price of fuel has not been this high since April, not long after the federal government announced it was halving the tax on fuel.<\/p>\n

The government restored half of the tax cut in July, and the 32 cents per litre concession will be totally removed on August 2.<\/p>\n

The government has ruled out extending relief at the bowser any further.<\/p>\n

“The fuel excise relief will end at midnight on Sunday,” Treasurer Jim Chalmers said this week.<\/p>\n

“It has played a really important role, helping to take some of the sting out of the cost-of-living pressures.”<\/p>\n

With the fuel excise ending, Monash University economist Robert Brooks says elevated fuel prices might start to feed into higher prices across many supply chains.<\/p>\n

“That’s certainly what’s happened across 2026,” he says.<\/p>\n

And it’s not just driving your own car.<\/p>\n

\"Woman, An illustration of a person holding a phone with a car and plane in the background.(ABC News Graphics: Sharon Gordon)<\/p>\n

The two major ridesharing companies, Uber and Didi, both increased fares at the start of the oil shock back in March.<\/p>\n

Like with home brand milk, both companies have confirmed prices haven’t dropped back down.<\/p>\n

“While fuel prices have eased from their peak, the cost of driving remains significantly higher than it was just a few years ago,” a Didi spokesperson said.<\/p>\n

“That’s why we’ve extended DiDi’s five-cent per kilometre fuel surcharge to continue supporting Australia’s rideshare drivers.”<\/p>\n

That is the funny thing about inflation.<\/p>\n

Once prices go up, economists note that it is relatively uncommon for companies to unscramble the egg.<\/p>\n

“You can get slowing inflation, which is a slower increase in the price level,” Professor Holden says.<\/p>\n

“But it’s really never going to go back down.”<\/p>\n

\"An An illustration of a basket full of everyday shopping essentials.(ABC News Graphics: Sharon Gordon)Credits:<\/p>\n

Reporting: Emilia Terzon<\/a> and Ahmed Yussuf<\/a><\/p>\n

Editing: Emily Stewart<\/a><\/p>\n

Commissioning editor: Danielle Cronin<\/a><\/p>\n

Illustrations: Sharon Gordon<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"An illustration of a morning routine from people brushing their teeth, eating breakfast, driving to work and taking…\n","protected":false},"author":2,"featured_media":721608,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[186714,32925,84,6948,3363,31756,1294,143842,169926,19132,238563,681,186,31762,56,54,55],"class_list":["post-721607","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy","tag-airfares","tag-bread","tag-business","tag-coffee","tag-cost-of-living","tag-didi","tag-economy","tag-essentials","tag-make-up","tag-milk","tag-nappies","tag-petrol","tag-prices","tag-uber","tag-uk","tag-united-kingdom","tag-unitedkingdom"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/721607","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/comments?post=721607"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/721607\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media\/721608"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media?parent=721607"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/categories?post=721607"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/tags?post=721607"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}