Australian petrol prices could reach $8 a litre: report

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A new report by Australia's peak science body, the CSIRO, has warned the cost of petrol could rise to as high as $AU8 a litre in the next 10 years.

The Fuel for Thought study by the Future Fuels Forum says that would be the worst-case scenario if oil production doesn't keep up with increasing demand.

Dr John Wright from the CSIRO says the study also suggests that such an oil shock would have a greater impact than a carbon emissions trading scheme.

"If we end up as a result of an emissions trading scheme price of carbon dioxide credit at something like $40 per tonne which is reasonably likely, that would increase the price per litre of fuel by about 10 cents," Dr Wright said.

Engineer Phil Hart from the Australian Association for the Study of Peak Oil and Gas, believes it won't be long before the demand for oil will outstrip supply.