The price of oil drove the PPI up

After a decline in February the PPI rose again in March as it did the previous six months before that. The price of crude oil and natural gas were the main contributors. One barrel of Brent Crude oil was priced at around 70 US dollars towards the end of the month. Among the industries that pulled in the other direction, the most important were extraction related services and refined petroleum products. Although crude oil is the main input factor in the refining industry, the price development does not always coincide. Over time, however, one will see a clear relationship between the price development of crude oil and refined petroleum products.

Decline in manufacturing while electricity went up

Despite of a decrease in prices on refined petroleum products especially but also on basic metals, the prices within manufacturing as a whole only went down by 0.1 per cent. This decline was more or less offset by higher prices on food products. Prices on processed fish, dairy products and animal feed were among the subgroups that increased in prices.

The prices of electricity went up by 7.3 per cent and it was the fifth month in a row with an increase. In addition, the electricity index was 35.6 per cent higher than March last year. From July 2015 the index, which is amongst the most volatile within the PPI, has risen by almost 168 per cent towards March 2018.