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Opposition claims oil figures wrong

THE WA Opposition claims the state budget has continued to grossly underestimate the world price of oil so as to show revenue windfalls that help fund public spending. Opposition finance spokesman Dan Sullivan said Labor had forecast an oil price of $US27 a barrel last year, but the actual price came in at $US47, which meant an extra $310 million in revenue for State Treasury. He said the prediction for 2005-06 was $US40/barrel, which was significantly below forecast by analysts and the current price of $US52. According to Mr Sullivan, Macquarie Bank had forecast an oil price of $US44 for 2006, while UBS Investment Bank had opted for $US43. “If the oil price stays around the $50 a barrel mark this coming financial year the Government will reap an extra $155 million,” Mr Sullivan said. “Despite this massive revenue windfall resulting from underestimating the oil price, Labor has been unable to deliver any real tax cuts.” He said the budget in 2002-03 had projected the oil price to be $US23/barrel and the actual price was $US29, meaning additional revenue of $93 million.

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